MonthJune 2019

Who will repay the non-bank loan after the borrower’s death?

July 7, 2017 Mr. Sebastian, inherited from his deceased father, inherited a flat worth 300,000. zł. However, along with the real estate, it also took over a mortgage and payday loans for a total value of PLN 400,000. zł. Can the inheritance be rejected if the debt exceeds the inherited capital? The heir should be aware that he will answer for the inherited debts with all his property. 

Inheritance law – you will inherit debts along with your estate

Inheritance law - you will inherit debts along with your estate

The inheritance is the inheritance of property of the deceased. However, with the ownership rights taken over, the obligation to settle debts is assumed. In some cases, the value of liabilities is higher than the capital received.
There are two types of heirs in the light of legal provisions:

  • Statutory heir – is appointed when the testator has not made a will. It is also appointed when other heirs do not want to accept the inheritance.
  • Testamentary heir – a natural or legal person included in the estate. A conceived child may also be a testamentary heir.

He is responsible for all inherited debts

The borrower’s death does not mean the cancellation of any credit or loan. If the heirs do not seek to settle the debt, the bank or loan company may take steps to recover the debt.
The creditor will demand repayment of all debt (including interest), even if the heir was not aware of the loans or non-bank loans. It is worth noting that in such a case he is responsible for the debts arising with all his property.

Who doesn’t pay inheritance tax?

Who doesn

Pursuant to applicable law, the heir is obliged to pay tax on the seized material goods. Because the inheritance has a real impact on increasing the inheritance’s assets.
Important – the immediate family of the deceased is exempt from inheritance and donation tax. To the group of close family members, the legislator includes: spouses, parents, stepmothers, stepfathers, children, stepchildren, siblings. Such persons will not pay “tribute” if they submit an SD-Z2 form to the Tax Office within 6 months of the tax obligation arising.

What will the inheritance tax amount to?

What will the inheritance tax amount to?

The amount of inheritance tax will depend on which tax group the heir will be in. Tax-free amount is not taxable. There are three tax groups:

  1. Group I (free amount PLN 9,637) – immediate family – spouses, descendants (children, grandchildren), ascendants (parents), siblings, stepmother, stepfather, etc.
  2. Group II (PLN 7,276 free) – extended family – parents ‘siblings, siblings’ spouses, etc.
  3. Group III (free amount PLN 4,902 – distant family or unrelated persons, etc.

How do you give up your inheritance?

How do you give up your inheritance?

If the heir does not want to receive the inheritance, he has the right to opt out of inheritance. It is worth knowing that the law makes it impossible to renounce an inheritance to a third party. The contract must take the form of a notarial deed and is signed during the testator’s lifetime. Documents may be submitted by a representative. The contract becomes legally binding upon the death of the transferor.

However, it may not be possible to decline the succession until the death of the testator. The heir has 6 months from receiving the information on inheritance. The inheritance may be rejected orally or in writing. The authorities authorized to accept the refusal of succession are the court or notary public. Be aware that when you drop an inheritance, the next person in the queue for inheritance automatically takes over.

In turn, the person who has taken over the property, wants to transfer the inherited capital, must do so by donation.

Inventory benefit – save your debts

Inventory benefit - save your debts

At the end of 2015, regulations regarding the acquisition of inheritance debts changed. An heir who has not submitted an application to accept or reject the inheritance automatically inherits with the benefit of inventory.

\This means that the person inheriting the debts of the deceased is liable only within the limits of the property received. If the subject of the drop is a luxury limousine worth PLN 200,000 PLN and debt in the amount of PLN 300,000 PLN, the claim may not exceed the value of the inheritance. In this case, the amount to be repaid will be PLN 200,000. zł.
Important – according to the principle of the benefit of inventory – if the object of the inheritance will be only debts, the heir is not obliged to cover them.

Bailiff auctioning due to the lack of repayment of inherited debts

Bailiff auctioning due to the lack of repayment of inherited debts

Failure to settle the debt results in launching the debt recovery procedure. The creditor will first issue reminders and reminders. Please be aware that every call to pay is payable. If the debt collector does not agree with the debtor, the case will go to court.

The court issues a writ of execution. On its basis, the bailiff will take steps that will result in the return of the claim. The debtor is responsible for all the inherited liability. Therefore, you should be aware that the enforcer can take all valuable items owned by the person with the debt.

Important – the bailiff will not take over the movable property which is the basis for survival (food, clothing). The enforcer also has no right to take over documents, decorations and subjects for learning and performing religious practices.

One of the conditions for obtaining a loan is age restrictions

One of the conditions for obtaining a loan is age restrictions

Age has a significant impact on the loan. Most often, the borrower at the time of the commitment can not exceed 75 years. Interestingly, the average life expectancy in Poland is 77 years. Financial institutions do not require medical examinations prior to granting the loan, which would show the state of health of the person applying for payday pay. The main factor affecting the granting of cash loans and online loans is the financial situation of the borrower and the possibility of paying off the debt.

Loan insurance against the borrower’s death

Loan insurance against the borrower

Some financial institutions offer loans with insurance. The premium is charged automatically with the payday loan or loan installment. The policy allows a wide range of protection. Under insurance, you can get financial help if the borrower loses his job or if he is unable to take any paid work for health reasons.
What’s more, insurance companies offer life insurance policies that are effective collateral for the loan. The compensation will be paid, among others in the event of the death of the insured. The scope and sum of insurance are key in choosing the right policy.

Non-interest costs – what are they?

No interest, or what?

No interest, or what?

As the name suggests, non-interest costs are all fees that we will incur in connection with the launch of an installment loan, payday loan or bank loan, but other than interest. These include commissions, margins, administrative fees, application fees, insurance fees, etc. In the loan sector, we have a new definition of the term. Since July 10, 2015, non-interest charges officially include fees that the borrower incurs in connection with his decision to use the home service option.

Non-interest costs in the light of the Anti-usury Act

Non-interest costs in the light of the Anti-usury Act

With the lifting of restrictions on non-interest costs in 2011 (they could not exceed 5% of the loan or credit granted), financial institutions were given the green light to charge fees other than interest at any level. The lack of ranges in which the price of a financial liability should close, allows lenders to impose a number of additional fees on the client, and thus – to strongly increase the total cost of the loan. Changing the regulations has also become a water for a mill for dishonest companies, which, wanting to earn on contracts, often led customers to excessive debt. For this reason, non-interest costs have become the most important issue in creating the so-called the Anti-usury Act, which aims to cover the regulations of the unattended market for non-bank loans.

Non-interest expenses are again limited

Non-interest expenses are again limited

The amendment to the Act on financial market supervision provides for a two-stage limit for non-interest costs. First of all, they cannot exceed 25 percent. basic amount. Secondly, they can reach a maximum of 30% per annum. loan value. In addition, the new provisions stipulate that together the customer may not be charged with costs greater than 100 percent. the value of the commitment received. Moreover, if the borrower has several loans within 120 days (he pays back one and incurs another one), non-interest costs will be calculated only on the first commitment. Considering that usually new customers can apply for relatively low amounts (in ViaTEXT it is 800 PLN, in Hillarium – 1000 PLN, in MetLoan and Loki – 1500 PLN, in Vivus – 1600 PLN), this solution should work in favor of consumers.