Collateral of the Borrower on the Loan by a Third Party: the Risk to Lose the Right of the Dwelling Ownership (Part I)

Abstract

Introduction: the article examines the real transaction of collateral by a citizen-the owner of his/her dwellingin securing the bank credit liabilities of a commercial corporate borrower. The legal nature of the risk incurred by the owner of the apartment, who transferred the premises to the bank as a mortgagor under the mortgage agreement (real estate pledge) by a third party is revealed. The illegal behavior of the head who is the only founder of the corporate borrower, expressed in the malicious evasion of due repayment of the credit debt to the bank, and also the percent for the received credit is analyzed. The illegal ways to evade the financial responsibility of the organization – the debtor to the creditors- are brought to light. The purpose of the study is to reveal the current legal protection order of the civil rights of a citizen – mortgagor. Methods: the research is based on the general scientific method of historical materialism. The general scientific methods of cognition are applied: dialectical, hypothetical-deductive methods, generalization, induction and deduction, analysis and synthesis, empirical description. In the study there were also used such specific scientific methods as the legal and dogmatic one, the method of particular sociological research, comparative law analysis, the structural and functional method, etc. Results: the authors studied a number of enacted courts’ acts, reflecting the enforcement special characteristics to the situations, which include the interacting entities – natural and legal persons – in the period of the studied long-time litigation; revealed the appearance and development of the related procedural relations and the relations of a civil and criminal law nature. Conclusions: it is proved that the probability of an adverse event during the long-term collateral transaction is quite high and can be realized in the form of withdrawal from the owner of his/her premises for other people’s debts.