OFFER AND ACCEPTANCE AS STAGES IN THE CONCLUSION OF A CREDIT AGREEMENT

Abstract

The article examines the legal regulation of offer and acceptance as stages in the conclusion of a credit agreement, taking into account the provisions of the Civil Code of Ukraine and the Law of Ukraine «On Consumer Lending». The conditions are identified under which proposals of financial institutions containing credit terms should be qualified as an offer, and when they should be regarded as an invitation to conclude an agreement. The author emphasizes that an offer must comply with the requirements established in Article 641 of the Civil Code of Ukraine, whereas an invitation to make proposals for concluding a credit agreement contains information that draws the attention of a potential borrower and encourages them to approach a financial institution to enter into the agreement. Advertising of consumer credit constitutes such an invitation. The study substantiates that a consumer’s application to a financial institution for obtaining credit should be considered as an initiation of the conclusion of a credit agreement rather than as an offer. A prerequisite for the borrower’s informed decision to conclude a credit agreement is familiarization with the information provided by the lender prior to the conclusion of such an agreement. The essential and other terms of the credit agreement are formulated taking into account the borrower’s needs and financial situation. Based on the analysis of special legislation, it is concluded that the lender acts as the offeror in the process of concluding a credit agreement. An exception arises when the parties have agreed upon the terms of the credit agreement and the borrower signs it first. The author also notes that if the borrower has an open settlement, deposit, or other account with the bank, the consumer credit agreement is concluded by the borrower’s accession to the terms proposed by the lender. Regardless of whether the credit agreement is concluded in the traditional (face-to-face) manner or through information and telecommunication systems, the process involves two stages – offer and acceptance.