Tiếng Việt
Foreclosure is when a credit institution sells the borrower’s mortgaged property when the debt is not paid on time. The mortgaged property can be handled through the methods prescribed in Article 303 of the 2015 Civil Code.
The bank’s asset foreclosure process includes the following main steps:
– Determining breach of contract: When the customer fails to pay the debt on time, the bank begins legal steps to foreclose the property.
– Notice of foreclosure: According to the law, the bank will issue a written notice of foreclosure of the secured property to the relevant parties, stating the reason, description of the property, security obligations and information about the location, time and method of handling the property.
– Valuation of assets for auction: The assets will be valued by professional valuation companies according to regulations on auctioning mortgaged assets or agreements between the parties, ensuring that the price is consistent with the market.
– Public auction: The assets are sold through public auction to ensure transparency and fairness. Information related to the auction must include: the name of the asset and the location of the auctioned asset, the name of the organization and the person with the auctioned asset, the address of the organization and the person with the auctioned asset, the time and location of the auction, the conditions and methods of registration to participate in the auction, along with the starting price and deposit if
– Transfer of assets: After the asset is sold, the proceeds will be used to pay off the debt.
The specific time for the auction depends on the preparation process and auction procedures, usually lasting from several months depending on the actual situation and procedures at the bank.
According to the provisions of Clause 2, Article 7 of Resolution 42/2017/QH14 on the right to seize secured assets as follows:
“Article 7. Right to seize collateral
2. A credit institution or the bad debt purchaser/manager is entitled to seize collateral put up by a grantor or holder of collateral only if it satisfies fully the following conditions:
a) Occurrence of any case in terms of treatment of collateral prescribed in Article 299 of the Civil Code;
b) The security agreement clearly indicates the grantor’s consent to the credit institution’s right to seize the collateral upon occurrence of the case of treating collateral as per the law;
c) The secured transaction or security interests has been registered as prescribed by law;
d) The secured assets are not disputed assets in a case that has been accepted but not yet resolved or is being resolved at a competent Court; are not being subject to temporary emergency measures applied by the Court; are not being seized or subject to measures to secure enforcement of judgments as prescribed by law;
dd) The credit institution or bad debt purchaser/manager has fulfilled obligation to publish information as prescribed in Clause 3 or Clause 4 of this Article.”
Hence, the bank auctions assets when the customer has bad debt (usually overdue bank debt of 91 days or more or in cases where the customer is unable to pay according to regulations). To have time to find a way to repay the debt and redeem the asset before the asset is auctioned, you can submit a request to the bank for an extension of the repayment period or you can request the court to consider the legality of the mortgage. Simultaneously, pursuant to Article 111 and Article 114 of the 2015 Civil Procedure Code, you can also request the court to apply temporary emergency measures to temporarily suspend the auction of the asset until the Court has a final judgment on the dispute.