Recovering Your Debts In Nigeria (Part I)
Recovering Your Debts In Nigeria (Part I)
DEBT RECOVERY: POSSIBLE OPTIONS FOR A CREDITOR IN THE NIGERIAN ENVIROMENT
BY OLUSOLA ADUN
INTRODUCTION
A debt simply means what one owes to another while creditor can be defined as one who is being owed by another. Debt situations can arise in a number of ways ranging from simple loan agreements to instances where goods and services are obtained with the consideration that they will be paid for at a future date. This paper attempts to look critically at debtor/creditor relationships and the various ways opened to a creditor in obtaining sums being owed him. The emphasis is on the Nigerian environment and the peculiarities attendant to it. Bother CAN DEBT SITUATIONS BE PREVENTED FROM ARISING?
Ordinarily no person sets out to be a debtor, debt situations in most cases are a result of a number of factors ranging from bad business acumen to simple bad luck on the part of the debtor, in this regard therefore the answer is no! Debt situations cannot be prevented from happening. However a creditor in Nigeria today must take some precautionary steps, which can at least reduce the occurrence of such situations to the barest minimum. Some of which include.
1. PROPER VERIFICATION AND DUE DILLIGENCE:
A creditor must always properly scrutinize the background of a prospective debtor. For example, searches can be conducted at the Corporate Affairs Commission where such person is a company. This can reveal how diligent it is in filing its annual returns and can unmask the personalities behind the company. Also claims by individuals regarding collaterals they wish to tender for loans should be properly investigated.
2. ALWAYS REQUEST FOR GUARANTORS:
In instances where parties enter into loan agreements, the lender should always request for the borrower to provide Guarantors for the loan. In law a Guarantor has the same rights and liabilities as the person he is Guaranteeing therefore a creditor will have someone to hold accountable where the borrower defaults.
3. INCORPORATING ARBITRATION CLAUSES IN ALL LOAN AGREEMENTS:
Disputes are an unavoidable part of human relations, however it is how disputes are managed that has now become pertinent. The trend the world over is to find an alternative to dispute settlement, apart from the conventional resort to courts. A wise creditor will always incorporate arbitration clauses in any loan agreement this will forestall any resort to tedious court processes.
DEBT RECOVERY: POSSIBLE OPTIONS FOR A CREDITOR IN THE NIGERIAN ENVIROMENT
BY OLUSOLA ADUN
INTRODUCTION
A debt simply means what one owes to another while creditor can be defined as one who is being owed by another. Debt situations can arise in a number of ways ranging from simple loan agreements to instances where goods and services are obtained with the consideration that they will be paid for at a future date. This paper attempts to look critically at debtor/creditor relationships and the various ways opened to a creditor in obtaining sums being owed him. The emphasis is on the Nigerian environment and the peculiarities attendant to it. Bother CAN DEBT SITUATIONS BE PREVENTED FROM ARISING?
Ordinarily no person sets out to be a debtor, debt situations in most cases are a result of a number of factors ranging from bad business acumen to simple bad luck on the part of the debtor, in this regard therefore the answer is no! Debt situations cannot be prevented from happening. However a creditor in Nigeria today must take some precautionary steps, which can at least reduce the occurrence of such situations to the barest minimum. Some of which include.
1. PROPER VERIFICATION AND DUE DILLIGENCE:
A creditor must always properly scrutinize the background of a prospective debtor. For example, searches can be conducted at the Corporate Affairs Commission where such person is a company. This can reveal how diligent it is in filing its annual returns and can unmask the personalities behind the company. Also claims by individuals regarding collaterals they wish to tender for loans should be properly investigated.
2. ALWAYS REQUEST FOR GUARANTORS:
In instances where parties enter into loan agreements, the lender should always request for the borrower to provide Guarantors for the loan. In law a Guarantor has the same rights and liabilities as the person he is Guaranteeing therefore a creditor will have someone to hold accountable where the borrower defaults.
3. INCORPORATING ARBITRATION CLAUSES IN ALL LOAN AGREEMENTS:
Disputes are an unavoidable part of human relations, however it is how disputes are managed that has now become pertinent. The trend the world over is to find an alternative to dispute settlement, apart from the conventional resort to courts. A wise creditor will always incorporate arbitration clauses in any loan agreement this will forestall any resort to tedious court processes.
DEBT RECOVERY: POSSIBLE OPTIONS FOR A CREDITOR IN THE NIGERIAN ENVIROMENT
BY OLUSOLA ADUN
INTRODUCTION
A debt simply means what one owes to another while creditor can be defined as one who is being owed by another. Debt situations can arise in a number of ways ranging from simple loan agreements to instances where goods and services are obtained with the consideration that they will be paid for at a future date. This paper attempts to look critically at debtor/creditor relationships and the various ways opened to a creditor in obtaining sums being owed him. The emphasis is on the Nigerian environment and the peculiarities attendant to it. Bother CAN DEBT SITUATIONS BE PREVENTED FROM ARISING?
Ordinarily no person sets out to be a debtor, debt situations in most cases are a result of a number of factors ranging from bad business acumen to simple bad luck on the part of the debtor, in this regard therefore the answer is no! Debt situations cannot be prevented from happening. However a creditor in Nigeria today must take some precautionary steps, which can at least reduce the occurrence of such situations to the barest minimum. Some of which include.
1. PROPER VERIFICATION AND DUE DILLIGENCE:
A creditor must always properly scrutinize the background of a prospective debtor. For example, searches can be conducted at the Corporate Affairs Commission where such person is a company. This can reveal how diligent it is in filing its annual returns and can unmask the personalities behind the company. Also claims by individuals regarding collaterals they wish to tender for loans should be properly investigated.
2. ALWAYS REQUEST FOR GUARANTORS:
In instances where parties enter into loan agreements, the lender should always request for the borrower to provide Guarantors for the loan. In law a Guarantor has the same rights and liabilities as the person he is Guaranteeing therefore a creditor will have someone to hold accountable where the borrower defaults.
3. INCORPORATING ARBITRATION CLAUSES IN ALL LOAN AGREEMENTS:
Disputes are an unavoidable part of human relations, however it is how disputes are managed that has now become pertinent. The trend the world over is to find an alternative to dispute settlement, apart from the conventional resort to courts. A wise creditor will always incorporate arbitration clauses in any loan agreement this will forestall any resort to tedious court processes.
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