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Wednesday, March 29, 2017

If You Borrow Money Without Agreeing On Interest, Do You Still Need To Pay Any Interest?

If you have agreed to lend (or borrow) money without ever agreeing on the interest rate, how much interest can be collected? A PERSON ONCE ASKED A LAWYER REGARDING A LOAN. “IF I TOOK A LOAN WITHOUT EVER AGREEING ON INTEREST RATE, CAN THE LENDER COLLECT INTEREST ON THE MONEY I OWE?” THE SIMPLE ANSWER IS YES. A SPECIFIC CASE TAKEN UP BY THE SUPREME COURT OF THE PHILIPPINES ANSWERS THIS VERY QUESTION. THE LEGAL RATE OF INTEREST ON LOANS, FORBEARANCES OF GOODS, MONEY OR CREDITS IS FIXED AT 6% PER YEAR. THE CASE Nacar vs. Gallery Frames , AFFIRMS THE VALIDITY OF BSP CIRCULAR NO. 796 DATED MAY 16, 2013. “In the absence of stipulation, the rate of interest shall be 6% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.” THIS IS ONLY APPLICABLE IF THERE IS A WRITTEN CONTRACT OR AGREEMENT THAT WAS MADE AT THE TIME OF THE LOAN, AND THE CONTRACT DOES NOT STIPULATE ANY INTEREST RATE. (Article 1956 of the New Civil Code) THE INTEREST RATE CAN GO HIGHER THAN 6% AS LONG AS IT IS AGREED UPON IN WRITTEN FORM OR CONTRACT. ADDITIONAL RULES APPLY LIMITING THE INTEREST.
If you have agreed to lend (or borrow) money without ever agreeing on the interest rate, how much interest can be collected?

A PERSON ONCE ASKED A LAWYER REGARDING A LOAN. “IF I TOOK A LOAN WITHOUT EVER AGREEING ON INTEREST RATE, CAN THE LENDER COLLECT INTEREST ON THE MONEY I OWE?”


THE SIMPLE ANSWER IS YES.
A SPECIFIC CASE TAKEN UP BY THE SUPREME COURT OF THE PHILIPPINES ANSWERS THIS VERY QUESTION.

 THE LEGAL RATE OF INTEREST ON LOANS, FORBEARANCES OF GOODS, MONEY OR CREDITS IS FIXED AT 6% PER YEAR.


If you have agreed to lend (or borrow) money without ever agreeing on the interest rate, how much interest can be collected? A PERSON ONCE ASKED A LAWYER REGARDING A LOAN. “IF I TOOK A LOAN WITHOUT EVER AGREEING ON INTEREST RATE, CAN THE LENDER COLLECT INTEREST ON THE MONEY I OWE?” THE SIMPLE ANSWER IS YES. A SPECIFIC CASE TAKEN UP BY THE SUPREME COURT OF THE PHILIPPINES ANSWERS THIS VERY QUESTION. THE LEGAL RATE OF INTEREST ON LOANS, FORBEARANCES OF GOODS, MONEY OR CREDITS IS FIXED AT 6% PER YEAR. THE CASE Nacar vs. Gallery Frames , AFFIRMS THE VALIDITY OF BSP CIRCULAR NO. 796 DATED MAY 16, 2013. “In the absence of stipulation, the rate of interest shall be 6% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.” THIS IS ONLY APPLICABLE IF THERE IS A WRITTEN CONTRACT OR AGREEMENT THAT WAS MADE AT THE TIME OF THE LOAN, AND THE CONTRACT DOES NOT STIPULATE ANY INTEREST RATE. (Article 1956 of the New Civil Code) THE INTEREST RATE CAN GO HIGHER THAN 6% AS LONG AS IT IS AGREED UPON IN WRITTEN FORM OR CONTRACT. ADDITIONAL RULES APPLY LIMITING THE INTEREST.

THE CASE Nacar vs. Gallery Frames , AFFIRMS THE VALIDITY OF BSP CIRCULAR NO. 796 DATED MAY 16, 2013.

 “In the absence of stipulation, the rate of interest shall be 6% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.”

If you have agreed to lend (or borrow) money without ever agreeing on the interest rate, how much interest can be collected? A PERSON ONCE ASKED A LAWYER REGARDING A LOAN. “IF I TOOK A LOAN WITHOUT EVER AGREEING ON INTEREST RATE, CAN THE LENDER COLLECT INTEREST ON THE MONEY I OWE?” THE SIMPLE ANSWER IS YES. A SPECIFIC CASE TAKEN UP BY THE SUPREME COURT OF THE PHILIPPINES ANSWERS THIS VERY QUESTION. THE LEGAL RATE OF INTEREST ON LOANS, FORBEARANCES OF GOODS, MONEY OR CREDITS IS FIXED AT 6% PER YEAR. THE CASE Nacar vs. Gallery Frames , AFFIRMS THE VALIDITY OF BSP CIRCULAR NO. 796 DATED MAY 16, 2013. “In the absence of stipulation, the rate of interest shall be 6% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.” THIS IS ONLY APPLICABLE IF THERE IS A WRITTEN CONTRACT OR AGREEMENT THAT WAS MADE AT THE TIME OF THE LOAN, AND THE CONTRACT DOES NOT STIPULATE ANY INTEREST RATE. (Article 1956 of the New Civil Code) THE INTEREST RATE CAN GO HIGHER THAN 6% AS LONG AS IT IS AGREED UPON IN WRITTEN FORM OR CONTRACT. ADDITIONAL RULES APPLY LIMITING THE INTEREST.


THIS IS ONLY APPLICABLE IF THERE IS A WRITTEN CONTRACT OR AGREEMENT THAT WAS MADE AT THE TIME OF THE LOAN, AND THE CONTRACT DOES NOT STIPULATE  ANY INTEREST RATE.
(Article 1956 of the New Civil Code)

 THE INTEREST RATE CAN GO HIGHER THAN 6% AS LONG AS IT IS AGREED UPON IN WRITTEN FORM OR CONTRACT. ADDITIONAL RULES APPLY LIMITING THE INTEREST.





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