What is the prolongation of the deposit in the bank? Deposit prolongation conditions
In recent times, there have been cases whena person who came to the bank for his deposit, is surprised to hear from the staff of the institution that with his finances, the deposit was automatically prolonged. What is itsuch and whether it is possible to abandon the procedure, you will learn by reading this article.
What is meant by prolongation of the deposit and where its conditions are prescribed
This is nothing more than an extension of the expireddeposit agreement. As a rule, it is carried out on the same terms, on which the deposit was opened. For those who are interested in what the prolongation of the deposit is,it will not hurt to know that it is automaticand non-automatic. In the first case, the client saves time for a visit to the bank, but at the same time he runs a lot of risk, because sometimes banks arbitrarily change the terms of the new contract. Therefore, you should not blindly rely on the consciousness of the staff, but it is better to go and renegotiate the agreement. In the second case, the client must personally come to the bank several days before the expiry date of the deposit agreement and sign an additional agreement to the old contract or re-register the new one.
As a rule, the terms of the deposit prolongationare prescribed by a separate clause of the main contract, when making out which the depositor is obliged to inform about the possibility of automatic renewal. In addition, employees must first agree with the client on the conditions under which the extension is possible.
On what terms is the extension of the contract
Those who want to be calm for the safety of their deposits, you need not only know what the prolongation of the deposit means,but also to have at least an approximate idea of the conditions under which it is being carried out.
First of all, it is necessary to pay attention toterm for the extension of the new contract. It must not exceed the one on which the original agreement was signed. And the new term starts from the date following the expiry date of the old deposit agreement.
The number of prolongations can be unlimited orlimited. In the first case, the deposit is reissued until the client decides to withdraw the money. In the second case, the number of possible extensions is prescribed by a separate item. And after the completion of the agreed number of prolongations, the deposit funds are automatically transferred to the demand account. Employees of the bank, in which the extension of the contract is not practiced, are required to remind the client in advance of the approaching expiration of the deposit term.
Is it possible to refuse the extension of the contract
Many customers, who perfectly represent what the prolongation of a deposit in a bank is,interested in whether they have the right to refusethis service. According to the current legislation, the depositor has the right to interrupt prolongation at any time. In order to do this, it is enough for him to appear in the bank and write an appropriate application for the termination of the deposit agreement. However, before deciding to take such a step, you need to think carefully. After all, if the deposit is closed before the expiration of the next term of the contract, the interest will be accrued according to a scheme identical to that accrued on the deposit "on demand". In other words, the client will receive less than 1% per annum. If the deposit is closed on the expiry date, the interest will be received in full.
How deposit conditions change
Those who are trying to figure out what the prolongation of the deposit is,it is necessary to understand that instabilityThe current market situation often forces banks to change deposit rates. Despite the fact that this may not be beneficial for clients, the staff of the institution will not specifically inform the depositors about the adjustments made. As a last resort, they can send a letter by e-mail. But it's not a fact that the depositor will notice the message and read it. Therefore, those who have a deposit tied to the phone, you can recommend periodically to be interested in the status of your account.
What will happen if the depositor fails to appear in the bank
Clients, figured out,what is the prolongation of the contribution,should understand that under the terms of the contractthe management of a bank account can not be entrusted to someone else. If, due to some circumstances, the investor can not come to the bank in time to prolong or break the contract, he must first write a power of attorney to someone close to him. This can be done at the notary's office or directly at the bank.
What happens if the depositor does not collect money
Most modern people know well what the prolongation of the deposit is. In the Savings Bankusually provides for automatic renewalterm deposits in case of coming into force of some unforeseen circumstances prescribed at the legislative level. But in reality each case has to be considered separately. Among these insurmountable circumstances are:
- natural cataclysms and natural disasters;
- situations related to the life of society (military actions, epidemics, strikes, revolutions, etc.);
- prohibitions imposed by government bodies.
Is the bank obliged to issue a new contract to the client with automatic extension of the deposit
Sometimes life circumstances do not allowa person who knows well what the prolongation of the deposit is, in time to appear for his money. Often after that, department managers refuse to issue a new copy of the contract to the client, arguing that this service is not provided for automatically renewing the deposit. How legitimate are such explanations and what will happen to the deposit if the bank unexpectedly goes bankrupt? Most lawyers soothe such customers, assuring them of no cause for concern. According to them, in the old contract, which provides for the possibility of automatic prolongation, it must be prescribed not only the date of completion of the deposit, but also the day to which the original interest rate is valid.
Of course, there are cases when a bank inunilaterally changes the effective rate. In order to avoid possible misunderstandings in this regard, experienced lawyers recommend that investors necessarily require the bank to provide them with a letter, certificate or any other documentation of an informational nature in which new data will be indicated.
In the event of bankruptcy of a financial institutionthe presence of a deposit in it can be proved by presenting a contract signed with the bank at the time of making the funds. As a confirmation that the money actually entered the account, you can use a savings book or another document of the established form.