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For example, mortgage lenders are required to file termination declarations as soon as the balance of the mortgage has been paid by the owner. It is important to obtain this declaration because it allows the owner to prove that he now owns his house freely and clearly. The termination declarations apply only to secured loans that hold certain assets as collateral. For unsecured loans, such as credit cards or personal lines of credit, no termination extract is required. Under the banking law, the repayment date of the credit is a period reserved for both parties, unless otherwise provided the loan agreement. What does that mean? It is important that the borrower and the bank are bound by the repayment date of the loan agreed in the contract. Therefore, if the contract is not specified otherwise, the bank cannot require the prepayment of the loan and the borrower cannot repay the loan before the agreed date without the bank`s agreement. This does not apply to situations in which a bank has the right to request prepayment of a loan because of a breach of its terms. For more information, click here: When can a bank terminate a credit contract?. The absence of a compelling reason to terminate the credit contract does not mean that the credit contract could not be terminated. This simply means that the bank should be careful to meet a reasonable notice period allowing the borrower to find alternative financing. The length of such a notice may vary from a few months to 12 months or more, depending on the circumstances. The reasons for termination can range from a more restrictive amount (for example.

B a borrower default or increased credit risk to the bank due to changing circumstances) to changes in the bank`s policy (for example. B of risk policy). The most compelling reasons are considered less unacceptable by the standards of adequacy and fairness. However, less restrictive grounds may lead the court to balance the interests of the bank and the borrower and to conclude that a termination according to the standards of adequacy and fairness is unacceptable and therefore invalidated. This is particularly the case where the borrower has a good reason to continue the credit report, for example because the borrower expects to be unable to use other financing and would therefore end up becoming insolvent as a result of the bank`s termination. In addition, if a court balances the respective interests of the bank and the borrower, it will be more critical of the reasons for termination if the borrower is not a professional party. Back to the banking law, the repayment date of the loan should not be reserved in favour of both parties and this expense can be settled differently in the contract signed by the bank with the customer. The parties may decide that the bank may require repayment of the loan before the agreed date and that the borrower has the right to repay the loan at any time before the final repayment date and that the bank will not be able to object to the loan, i.e. to prepay the loan. In practice, the deadline for the bank is not met in market contracts.

However, they can find solutions that allow the borrower to prepay the loan. Sometimes it is a matter of paying fees in the form of commissions.