Alina Esmanskaya told RBC what can happen if a loan is not repaid

As of 8 March 2022, amendments to law No. 106-FZ came into force, renewing the loan break mechanism that was previously in place during the pandemic. However, for a number of reasons, it will not be available to all borrowers. In this connection, RBC asked the experts what the recipients of credit can expect when it is impossible to continue servicing the debt.

Alina Esmanskaya, Associate of the Private Wealth practice at Maxima Legal, explained to RBC the consequences of failure to make the next payment. According to the expert if a debtor fails to repay the debt the bank has the right to demand early repayment of the entire loan amount and on the basis of the court decision to foreclose on the debtor’s property.

“Legislation also provides for criminal liability for malicious evasion from repayment of debt. Liability may be imposed if the debtor maliciously evades repayment of the debt after the relevant judicial act enters into force and the amount of the debt exceeds 2,250,000 rubles,” Alina clarified.

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