Loan default occurs when a borrower fails to pay back a debt according to the initial arrangement. Customers with non-performing loans are subject to penalties and their assets can be seized. The bank customer must be preventive in anticipating a possible default situation. If you anticipate difficulties in paying your charges, you must promptly alert the credit institution. If the bank customer reports that it has difficulties in paying its charges, the credit institution is obliged, under Law No. 227/2012, of 25 October, to assess its default risk. The credit institution must propose solutions to avoid default on the loan agreement, whenever feasible.

Customers with household loans that are in default and in a particularly vulnerable situation may ask the credit institution for access to the extraordinary regime, provided that they meet the legal requirements. This regime, designed to protect household loans debtors in very difficult economic situations, was approved by Law No. 58/2012, of 9 November, and will be in force until December 31, 2015, with the chance of extension. Under this regime, the credit institution is obliged to propose to the bank customer a debt restructuring plan, when feasible. In exceptional situations, the credit institution must propose solutions that lead to the partial or total elimination of the debt.

Bank customers with loans at risk of default or in arrears in the payment of their installments can obtain information, advice and follow-up from the bank customer support extrajudicial network, free of charge. The banking customer support network is made up of entities authorized and recognized by the Direção-Geral do Consumidor. For more information on the support network, consult the “Portal do Consumidor”, at www.consumidor.pt.