Loan agreement clause for missed payment
i have taken a loan from a person I work with and his lawyer drew up a loan agreement that we both signed and agreed upon. there is a clause that states “I agree and undertake to pay interest at the rate of 15% per annum on the balance of the capital outstanding is I fail to pay the agreed amounts on the stipulated dates. I have missed payment this month because I had lost a family member and needed to sort of funeral costs. when I got back to work he physically threatened me and told me I’m lucky I’m inside the workplace and he demanded his payment for the month. does the clause protect me if I didn’t meet payment this month?
Category: Banking & Finance, Loan Agreements
Region: South Africa, KwaZulu-Natal
1 Answer
Dear Raymond G, please understand that even a private loan should be honoured as required despite the penalty clause. It is really not a protection but rather additional penalty meant to protect the lender not you.
Amended by author 8th December 2017, 08:20
Good Morning R, imagine the shoe on the other foot….that he owed you the money and you need it and he skips payment….it does not prevent him from exercising his other legal remedies. …
Amended by author 8th December 2017, 09:12
No of course not Raymond! Theats are an absolute No No. Because he threatened your life you can go to the local police station and lay a charge of assault. However, to circumvent the undesirable state of affairs it is best to settle the debt issues ASAP.
Amended by author 8th December 2017, 09:19
No of course not Raymond! Theats are an absolute No No. Because he threatened your life you can go to the local police station and lay a charge of assault. However, to circumvent the undesirable state of affairs it is best to settle the debt issues ASAP.