What is the cancellation of a franc loan?

Franc loans electrify public opinion like few other things. Although the apogee of this problem took place quite a long time ago, there are still a whole lot of people who have to live with this huge burden, which is undoubtedly a loan in francs. For this reason, many people are wondering whether the “franc” contract can be annulled. What would such cancellation consist of, and what possible repercussions could it entail?

Outline of the problem – the source of the dispute over franking credits

A good few years ago, loans in foreign currencies became very popular. One of them was the Swiss franc, the exchange rate of which was at a record low at the time, and this tempted people to take out liabilities in this currency. Many institutions, such as the Financial Supervision Commission and experts pointed out the huge risks involved in such ventures. Frankovichs for a long time did not feel any negative consequences, and even thought they had caught the proverbial “God by the feet.” However, all this collapsed like a house of cards when the Swiss equivalent of the NBP released the Swiss franc exchange rate, and its value exponentially more than doubled in a single day. The result was a drastic increase in loan installments, which very often borrowers were unable to bear. That’s when demands began to be made to cancel the agreements made with banks.

Cancellation of credit in francs

The cancellation of a loan in francs has one main purpose, which is also the effect – to declare the concluded agreement with the bank as non-existent retroactively, i.e. as if it had not been concluded at all. Such a cancellation in the clearest version would thus look like this, that the debtor returns to the bank only the amount he borrowed from the bank, and any additional commissions are considered null and void. Courts, however, in lawsuits over the cancellation of a franc loan settle according to different methods. One of them is the, extremely controversial, method of balance, which assumes that the one who obtained the greater benefit from a given legal relationship loses the trial. Thus, if we borrowed 100 thousand zlotys from the bank. and managed to give back 80 thousand, the bank will, as it were, automatically dismiss our lawsuit. Another method is the method of conditioning, which is much more favorable to the borrower, since it involves demanding the return of the amounts paid up to 10 years back, if the bank has not made a separate demand. However, it must be remembered that the bank in a separate lawsuit can demand the return of this money.

Effects of the cancellation of a loan in francs – is it even worth it?

In itself, the cancellation of a loan in francs seems to be a good solution. In this way we get rid of this “ball and chain”. However, it should be remembered that the cancellation of a loan in francs also causes some momentous consequences that may not be entirely beneficial to the borrower. One of them is the aforementioned possibility of prolonging the court battle between the borrower and the bank. Even if the court chooses a more favorable method of settlement for us, this does not necessarily mean that our “adventure” with the bank is over. Another consequence, in a situation where the loan has not yet been repaid, may be that the debtor is obliged to immediately repay the remainder of the obligation.

For more information, visit https://kancelariafrankowicza.pl/

This article is not financial advice

Brigham Hill

As Brigham Hill, the creator of Inlogic.eu, my passion for diverse knowledge and sharing it with the world has led me to establish a digital portal that explores a wide range of topics. My background, rooted in an insatiable curiosity about the world, drives the website’s content, from health and beauty, motorization, to legal and even taboo subjects. I believe in the power of education and information, aiming to make it accessible to everyone. My journey into this venture began with a simple desire to create a space where learning and sharing knowledge are valued above all. Through Inlogic.eu, I've strived to connect with like-minded individuals who seek understanding and insights into the various facets of our lives, demonstrating my commitment to a well-informed community.