Wednesday, December 02, 2020

How not to enter into loan or credit agreements? What excludes successfully concluded contract?


The primary goal of the loan, whether obtained in cooperation with the loan company or with the bank, is to receive the amount of money needed in the shortest possible time and on favorable terms.

If the road does not get badly filled in documents or a complete lack of creditworthiness, as a rule, this process is successfully completed. However, there are cases where this is not possible for various reasons and the loan agreement becomes invalid. What are these cases? How not to enter into loan and credit agreements?

Invalid loan agreement – when?

Invalid loan agreement - when?

How not to conclude loan agreements and what to look for? When we decide to conclude a loan agreement and our lender is not a bank or a loan company, its content remains optional except for a few basic information. Let’s look at an example of a loan agreement we give to a friend.

It does not matter how many items and tables it has, if it contains both personal data of both parties and basic records about the principle of their cooperation. Lack of this type of information will make it invalid. At this point, it is also worth citing article 720 of the Civil Code (Journal of Laws 2011 No. 126 item 715):

However, remember that in order to protect your own interests, you should insist on the written form of such an agreement, even if its value is PLN 200-300. As we mentioned, above PLN 1000, Polish law is entering the shares.

How not to conclude loan agreements?


How not to conclude loan agreements? From a legal point of view, the contract will be considered invalid, for example because of an improper form (e.g. in the case of a notarial deed), contradiction with the Act, or if the required third party did not agree to continue legal actions. We are talking, among other things, about the situation where the spouse did not receive permission to sign the contract.

The loan agreement will also be void if it is poorly worded, which means that you will not have enough data to be considered complete. This includes personal data of the parties (lender and borrower), type and amount of the loan, loan period and information on the consequences of ceasing to pay the liability.

If any of these elements is missing from the document, the contract may be considered void from a legal point of view. Importantly, the court has the right to refer to this state at any time of the dispute (if it occurs), even when neither party indicates an inaccuracy.

Signing the contract by an incapacitated person

Signing the contract by an incapacitated person

A lot of unnecessary controversy is raised by the issue of signing a contract with an incapacitated person, although, in fact, the matter is very simple. Such a document will never have legal force, regardless of whether we are talking about partial or total incapacitation.

A person who has been totally incapacitated may not perform any legal actions, i.e. dispose of real estate, draw up testament or donation documents, and incur financial obligations. Any such moves, if they are really necessary, are on the side of her legal guardian appointed by the court. So if it is not his signature that appears on the contract, but the incapacitated person, it will simply be invalid.

Partial incapacitation, as the name implies, is associated with a partial limitation of legal capacity. In order to complete any of the actions listed in the above paragraph, a partially incapacitated person needs the consent of a probation officer, also appointed by a court. His rights are not much different from those of an underage Polish citizen. Performing certain activities without parental consent is simply impossible. So there is no way that a loan or loan agreement signed by such a person would be considered valid.

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