Dear Attorney,
I hope you can assist me with a situation regarding a loan. I borrowed money, but due to unexpected medical expenses, I was unable to repay it on time. Now, the lender is harassing me and demanding that I pay only the interest (tubo). What legal action can I take to stop this harassment?
Sincerely,
Concerned Borrower
Insights
In the Philippines, situations like these may involve various legal concerns, including harassment, excessive interest rates, and debt collection practices. Several laws and regulations come into play when addressing such disputes.
1. Anti-Harassment Laws
Harassment by a creditor may be classified as a violation of the Anti-Harassment Law (RA 7877). If the lender is engaging in repeated, unwelcome, and offensive conduct aimed at coercing repayment, the borrower can seek protection under this law. Acts like verbal abuse, threats, or any form of intimidation fall under harassment, which can lead to criminal or civil liability for the lender.
2. Usurious Interest Rates
The borrower must also be aware of the Usury Law, even though it was relaxed under Central Bank Circular No. 905. Lenders can charge interest freely, but excessively high rates might still be deemed unconscionable. Courts can invalidate such terms if found to be against public policy or oppressive. If the lender is charging an exorbitant interest rate and applying undue pressure, the borrower may seek to have the interest adjusted by filing a complaint in court.
3. Debt Collection Practices
The borrower should be aware of the Fair Debt Collection Practices under the Revised Rules of Court and general principles of equity. If the lender's methods are abusive, intimidating, or harmful, these practices can be challenged. The borrower can file a complaint with the Barangay or local court to stop further harassment and resolve the issue through mediation.
In summary, the borrower has several legal remedies to address harassment and unfair debt collection practices. Filing a case based on harassment or unfair interest rates is one way to seek relief. Seeking assistance from the Barangay or court can provide protection and prevent further abusive collection methods.