Overdraft is a negative balance on your bank account. It arises when the client pays a larger amount of money than the amount of funds on the account. This product is an interesting alternative to a bank loan or loan. It is usually granted on better terms and you do not need to meet as many formalities as is the case, for example, with credit. However, what happens if your bank account balance is negative for a long time?
Limitation of the debit on the bank account – is it possible?
A bank overdraft is a claim directly related to a bank account. According to the Civil Code (Article 731), this type of debit expires after two years. However, in the case of claims that have been established by a final court decision (i.e. judgment or order for payment), the limitation period requires a longer period. According to the Civil Code (Article 125§1), this is a six-year period. Thus, the debit on the bank account, which went to the bailiff to carry out the execution of the debt, is barred only after six years from the date of initiation of enforcement of the bailiff.
As a rule, creditors do not wait long for the debtor to voluntarily pay off the debit created on his bank account. Banks operate in such situations quite quickly. So if the client does not start to pay his liability and avoids contact with the bank, then the matter will be transferred to the debt collection department of the unit or directly to an external company professionally dealing with debt collection. If the debt is still not repaid, the case will go to court and the limitation period will be extended to the abovementioned six years.
Obligation to repay debt and concluding an agreement after the statute of limitations on debt
Some debt collection companies may ask for repayment of the outstanding obligation, even if it has expired. They count on the debtor to settle his liability after all. If the debt has expired and the debtor signs the settlement and undertakes to repay the debt in installments, this will not affect the limitation, which ended its run exactly after two (or six) years from the due date. Under Polish law, a claim can only be recognized if it has not been time-barred. This means that even signing a settlement after the expiry of the limitation period is not treated as equivalent to the debtor’s recognition of his debt.
The case is different if the settlement was concluded before the limitation period specified by law. Such an action interrupts the limitation period of the claim, which causes it to be restarted, and thus the debt collection company gains additional time. She may then request the debtor to pay the debt, as well as file a lawsuit and charge further interest for late payment increasing the amount of the liability.
What is the waiver of the limitation period?
Perhaps some are wondering what the interest of debt collection companies that buy outdated claims. Well, they often include professionals who are able to properly “manipulate” the debtor. For most of them, recovering old, even expired debts is not a major problem. And this fact is inseparably connected with the waiver of the prescription of limitation of the claim. What exactly are we talking about?
Increasingly, in the settlement form of the debt collection company, among the conditions proposed by it, one can find a provision regarding the waiver of the statute of limitations. Signing such a settlement has negative consequences for the debtor. Well, after the conclusion of this type of agreement, the debtor loses the possibility of raising the plea of limitation of the claim. The settlement forms may also contain a provision on recognition of the expired claim, which is the same as the waiver of raising the objection of limitation. It is worth remembering when, as debtors, we get a settlement letter from the debt collection company. Our ignorance may in fact cause that we will be obliged to pay back a liability which has been legally barred. Before we sign any document, we should carefully analyze its records so as not to fall into the trap prepared by the debt collection company.
Limitation of debt for bank debits and debtors’ registers
Limitation allows for the evasion of old debt, but in reality does not mean that the commitment suddenly ceases to exist. The creditor may report such a debtor to, among others, the National Debt Register (KRD), the Economic Information Bureau (BIG) or the Credit Information Bureau (BIK). This in turn results in unpleasant consequences in the future. Loan companies and banks that check a client for financial support in the above registers of debtors may refuse to grant them a given financial product. Thus, persons who had unpaid debit on the bank account, despite the fact that their claim has expired, must reckon with entering their data in the registers of debtors.