Subsection 2: Default by the borrower

When the lender demands immediate repayment of the outstanding capital pursuant to article L. 312-39, it may claim compensation equal to 8% of the outstanding capital at the date of default.

Where the lender does not require immediate repayment of the outstanding capital, it may demand compensation from the defaulting borrower equal to 8% of the unpaid due instalments. However, if the lender agrees to defer future instalments, the amount of compensation is reduced to 4% of the deferred instalments.

In the event of default in the performance of a leasing contract accompanied by a promise of sale or hire purchase, the lessor is entitled to demand, pursuant to article L. 312-40, an indemnity equal to the difference between, on the one hand, the residual value excluding taxes of the goods stipulated in the contract, increased by the updated value, on the date of termination of the contract, of the…

When the lessor does not require the contract to be terminated, he may ask the defaulting lessee for compensation equal to 8% of the unpaid due instalments.However, if the lessor accepts deferrals of future instalments, the amount of the compensation is reduced to 4% of the deferred instalments.The amount of the compensation is increased by the applicable tax.