In the credit protection, the client responsible for compliance with their obligations (repayment of the amount borrowed, interest payments and bank agreed) with all its assets, present and future. Therefore, it is common practice that the lending credit institution before granting credit, customer request proof of your income (salary, rental income.), an inventory of its assets or an affidavit of its heritage and perform checks on the existence and location of it. If the client is delayed in the periodic payments (interest, bank charges) or refund the fee provisions in relation to the agreed dates, will be paid to the lending institution some additional interest known as “default interest”. The rate of interest on late payments is usually much higher than normal interest rate credit. The method of calculating interest on arrears listed in the contract document.

Furthermore, institutions tend to charge a “fee per claim” amounts outstanding customer claiming their late payments. The amount of this commission will be reflected in the contract document. If the delay or default is prolonged and the entity does not find a solution to this situation with the client, it can try to recover the outstanding debt and seizing property rights owned by the customer, following the procedure stipulated by law (Civil Procedure).

If a credit account with the additional guarantee of one or more guarantors ( “security clause”) and credited the customer defaults, the entity may apply directly against / the guarantor / s for the recovery of outstanding payments. Each of the Guarantors jointly and severally liable for all outstanding obligations of the debtor client in case of default (unless the benefit of “excursion” and “division”). In the case of loans to finance a product or service, so that there is a prior agreement between the exclusive supplier of the goods or services and the credit institution, the client may exercise against the lender have the same rights as against the supplier of goods or services.

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