We are hearing a lot about this balance and excerpt, but what is it about? In practice it is a sort of settlement offer that is offered in the event of economic difficulties to a debtor who for this reason is no longer able to fulfill the regular payments of a loan.
This formula is mainly implemented between banks and debtors, but also some private individuals or professionals can adopt it for their debts, obviously if both parties agree, but this is another topic.
The balance and excerpt is a good-natured agreement between the parties , between creditor and debtor, which agree on a reduced compensation compared to the original amount to be paid.
Ultimately, therefore, it is a means of meeting today’s economic difficulties, and in any case also ascertained by lawyers and freelancers, certainly not spared by the modern economic crisis.
Not only that, this agreement also allows creditors to recover part of the debt, even if less than the amount originally agreed, in the face of the fact that these often remain with a handful of flies .
The only constraint is the balance of the debt, which will be extinguished immediately and only in this way will the individual’s debt position be eliminated through an excerpt . Finally, according to experts, the balance and excerpt is a real transaction and not a contract , as it is often incorrectly defined.
What are, more specifically, all the advantages of the balance and excerpt for debtors and creditors?
Undoubtedly the choice of this payment formula is above all practical and also allows those with economic problems to pay off the loan in a good-natured way.
In particular, the debtor’s own advantages and benefits are also linked to the amount to be repaid, which is lower with the balance and excerpt than that agreed upon when the loan, mortgage or loan was stipulated.
The reduction can even reach 30% or 40% of the total amount : a considerable reduction and above all easier to return for those in economic difficulty.
It is also possible to agree with the creditor and to plan a deferred compensation in tot installments, obviously if both parties agree.
The creditor, on the other hand, benefits from it as he can instantly cash a considerable amount, even if not the one originally agreed and avoids taking legal action.
In the latter case, you will avoid expenses for initiating a proceeding and a case, or even just to seek advice from one of your fellow lawyers.