The period for the termination of the loan agreement, in accordance with banking law, is 30 days and, in the event of a risk of bankruptcy, 7 days for the borrower. The provisions of the loan agreement can only extend this period, they cannot shorten it. Any contractual provisions allowing the bank to terminate the contract in the short term or immediately would be inoperative. Back to the banking law, the repayment date of the loan should not be reserved in favour of both parties and this expense can be settled differently in the contract signed by the bank with the customer. The parties may decide that the bank may require repayment of the loan before the agreed date and that the borrower has the right to repay the loan at any time before the final repayment date and that the bank will not be able to object to the loan, i.e. to prepay the loan. In practice, the deadline for the bank is not met in market contracts. However, they can find solutions that allow the borrower to prepay the loan. Sometimes it is a matter of paying fees in the form of commissions. The general rule of interpretation of a treaty in the Netherlands states that a contract is interpreted not only in a literal way, but also by virtue of the fact that both parties could reasonably yield to a contractual provision, in the circumstances and with respect to what they can reasonably expect from each other. We call this the “haviltex test”2 The assessment and determination of the circumstances that led to the termination of the contract are the responsibility of the bank. However, this assessment should be based on objective reasons.
If the borrower feels that the bank`s termination of the loan agreement was unfounded, the borrower may initiate civil proceedings against the bank in court. In August 2015, the Court of Appeal of `s-Hertogenbosch ruled that the validity of a termination must be determined in particular by: (i) the reasons for the bank`s termination; (ii) if the reasons for the termination have been communicated to the borrower; (iii) the bank`s notice period.6 We believe that the courts may take these factors into account even if the credit contract was entered into between a bank and another party close to the business, particularly when a standardized credit contract has been used, for example. B GBC-based agreements. In cases where the parties resort to contractual agreements negotiated and concluded with professional legal advice, these factors are unlikely to be relevant. For example, mortgage lenders are required to file termination declarations as soon as the balance of the mortgage has been paid by the owner.