[Direct answer]If the borrower fails to repay the loan on time, the following three steps can be taken to initiate legal action: 1. **Collect evidence**: Gather and organize receipts, promissory notes, transfer records, and collection records. Note the three-year statute of limitations according to Article 188 of the Civil Code. 2. **Select a court**: File the lawsuit at the basic-level court in the defendant's residence or the location where the money was received. If the lawsuit meets the conditions set forth in Article 122 of the Civil Procedure Law, the court must register the case within seven days. For cases with clear creditor-debtor relationships, a payment order can also be applied for. 3. **Enforce the judgment**: Claim the principal, legal interest, and overdue interest. If the defendant fails to comply after winning the case, apply for forced execution within two years. For further assistance, please consult a legal professional.Legal services for creditor-debtor relations and enforcement casesAndBeijing Henglue Law Firm.

1. Problem background and typical scenarios

Private lending is the most common type of debt dispute. Typical scenarios include: acquaintances borrowing money without writing a promissory note out of courtesy, only leaving a transfer record; cash payments that cannot prove the actual receipt of the funds; interest rates being only verbally agreed upon, with the borrower denying it when repayment is due; the borrower repeatedly delaying repayment on the grounds of business difficulties, then losing contact or pretending to be poor; and writing a promissory note but then delaying repayment for a long time and refusing to answer the phone. The lender's most pressing concerns are: whether they can sue without a promissory note, which court to choose, how much it will cost, and how long it will take to recover the money. Evidence organization and strategy selection before litigation often have a greater impact on the outcome than the court hearing itself.

II. Key points of contention

  • Determination of the facts of the loan: When there are only transfer records but the other party claims that it is a payment for goods, a repayment, or other transactions, how is the burden of proof distributed? How can the delivery of cash be substantiated through withdrawal records, witnesses, and subsequent confirmations to strengthen the chain of evidence?
  • Determination of principal and interest: Where the interest is deducted in advance from the principal, the principal shall be determined based on the actual amount of the loan; the claim for interest shall be subject to a cap of four times the one-year LPR rate at the time the contract is concluded, and the excess part shall not be protected.
  • Prescription and execution risks: Whether there is evidence of interruption in debt collection within the three-year statute of limitations; whether there are assets under the other party's name that can be preserved and executed, which determines the actual value of the lawsuit.

III. Professional analysis by Henglue Lawyers

Before filing a lawsuit, there are three things you need to do to avoid detours. First, complete the evidence chain: a promissory note plus a transfer receipt is the most reliable. For cases with only transfer records, you can supplement the evidence with WeChat chat records confirming the debt, call recordings, and written materials showing the other party's commitment to repayment. According to the Judicial Interpretation of Private Lending, if the plaintiff sues solely based on transfer receipts and the defendant claims that the payment was to repay a previous loan or other debt, the defendant must provide evidence to support their claim. Even after the defendant provides evidence, the plaintiff still needs to prove the existence of a lending relationship. Second, calculate the principal and interest: if interest is deducted from the principal in advance, the principal shall be determined based on the actual amount received (Article 670 of the Civil Code); the total interest and overdue interest shall not exceed four times the one-year LPR at the time of contract conclusion. Third, investigate the other party's assets and credit status to decide whether to apply for pre-litigation or in-litigation preservation. Preservation measures are often more effective in promoting repayment than judgments. Procedurally, private lending cases are generally under the jurisdiction of the court at the defendant's residence. If there is no agreement on the performance location in the contract or the agreement is unclear, the performance location shall be determined based on the location of the party receiving the money (Article 3 of the Supreme People's Court's Interpretation on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases). Lenders can usually file a case in the court at their own residence. If the accounts are clear and the documents are complete, they can also apply for a payment order first. If the debtor does not raise objections or fulfill the obligation within 15 days, they can apply for enforcement. 起诉前做好三件事能少走弯路。第一，补全证据链：借条加转账凭证最稳妥，仅有转账记录的，可通过微信对话确认债务、通话录音、对方承诺还款的书面材料等补充；根据《民间借贷司法解释》，原告仅依据转账凭证起诉，被告抗辩系偿还双方之前借款或其他债务的，被告应对其主张承担举证责任，被告举证后原告仍需证明借贷关系成立。第二，算清本金与利息：利息预先在本金中扣除的，按实际到手金额认定本金（《民法典》第670条）；利息与逾期利息合计以合同成立时一年期LPR四倍为限。第三，排查对方财产与信用状况，决定是否申请诉前或诉中保全，保全到位往往比判决更能促成还款。程序上，民间借贷一般由被告住所地法院管辖，合同对履行地没有约定或约定不明的，以接受货币一方所在地为合同履行地（《最高人民法院关于审理民间借贷案件适用法律若干问题的规定》第3条），出借人通常可在自己所在地法院立案；账目清楚、凭证齐全的，也可先申请支付令，债务人15日内不异议不履行的即可申请执行。

IV. Practical suggestions and legal basis

At the legal basis level: Article 122 of the Civil Procedure Law (amended in 2023 and implemented on January 1, 2024) stipulates the conditions for filing a lawsuit, and the court shall file the case within seven days if the conditions are met; Article 103 stipulates that property preservation can be applied for during the litigation; Article 246 stipulates that the period for applying for enforcement is two years. Article 2 of the Supreme People's Court's Interpretation on Several Issues Concerning the Application of Law in the Trials of Civil Loan Cases (amended in 2020 and implemented on January 1, 2021) requires the lender to provide evidence of the loan, such as promissory notes, receipts, IOUs, and other proofs of the existence of the loan relationship; Article 3 specifies the place of performance of the contract; and Article 25 establishes the interest rate cap of four times the one-year LPR. Article 675 of the Civil Code (implemented on January 1, 2021) requires the borrower to repay the loan according to the agreed time limit, Article 676 stipulates that overdue interest shall be paid if the loan is overdue, Article 670 regulates the so-called "head-cutting interest", and Article 188 stipulates a three-year statute of limitations. At the practical advice level: The complaint should specify the principal, the method of calculating interest and the deadline; for large-scale cash loans, supplementary explanations of the source of funds and the details of the delivery should be provided; submit an application for preservation and provide clues to the property at the same time when filing the case; if the other party is uncontactable, an announcement for service can be applied for; after the judgment, apply for enforcement in time; and for enterprise loan contracts, other relevant documents can also be provided as supplementary materials.Business and contract dispute services for enterprisesEvaluation.

5. Henglue Law Firm's Advice

When suing for unpaid loans, the outcome often hinges on what happens before the trial: whether the evidence chain is complete, whether the principal and interest have been accurately calculated, and whether the assets have been properly preserved. Leaving evidence when lending, leaving evidence when collecting debts, and taking prompt action to preserve evidence when suing are three of the most worthwhile habits to cultivate. It is crucial to avoid resorting to private remedies such as cutting off water and electricity or detaining people and seizing property, to avoid turning from a creditor into a wrongdoer. If the loan amount is large and there are signs of the other party transferring assets, it is recommended to hire a lawyer as soon as possible to apply for investigation and preservation of assets, which can be done through legal channels.Legal services for creditor-debtor disputes and enforcement casesObtain the overall collection and recovery plan.

Q1: If there's no IOU but only transfer records, can I still win the lawsuit?

You can sue, but you need to provide additional evidence. According to the Judicial Interpretation of Private Lending, if the plaintiff files a lawsuit solely based on the transfer receipt, and the defendant contends that the funds are repayment of previous loans or other debts between the parties, the defendant shall provide evidence to support his claim; after the defendant provides evidence, the plaintiff still needs to bear the burden of proof for the establishment of the lending relationship. In practice, you can confirm the loan amount and term through WeChat conversations, call recordings, records of the other party's commitment to repayment, and witness testimonies to strengthen the evidence, and then sue after forming a complete chain of evidence. This approach is much more reliable than relying solely on transfer records.

Q2: Which court should I go to file a lawsuit? How much is the litigation fee?

Generally, the lawsuit is filed with the basic-level court at the defendant's residence. If there is no agreement or an unclear agreement on the performance location in the civil loan contract, the place where the party receiving the money is located shall be the performance location of the contract. The lender can usually file a lawsuit in the court at his own residence. The litigation fees shall be paid in stages according to the amount of the dispute, with a fee of 50 yuan per case for an amount not exceeding 10,000 yuan (the "Measures for the Payment of Litigation Fees" came into effect on April 1, 2007). The fee rate will decrease as the amount increases, and the losing party shall bear the fee after the victory; the fees for applying for preservation and the guarantee shall be calculated separately. When filing a lawsuit, you only need to bring the complaint, your identity and main materials, and a list of evidence.

Q3: How long will it take to get the money back after filing a lawsuit?

For cases handled in summary procedure in the first instance, the trial is generally concluded within three months; for cases handled in ordinary procedure, the trial is generally concluded within six months (according to the time limit provisions of the Civil Procedure Law); if the other party appeals, the second-instance court generally makes a final judgment within three months. After the judgment takes effect, if the other party fails to repay the debt before the expiration of the performance period, the applicant shall apply for compulsory enforcement within two years. The court will freeze and transfer the property through online investigation and control. For cases with clear accounts and complete vouchers, the applicant may also apply for a payment order first. If there are no objections within 15 days, the enforcement process can begin, which significantly shortens the enforcement period.

Q4: If the other party says they don't have the money, is it still useful to sue them?

It's useful. The effective judgment is the basis for applying for enforcement. The court can investigate and control the debtor's bank deposits, real estate, vehicles, equity, and online funds, and list them on the dishonesty list and restrict their high-consumption behavior. If the debtor refuses to perform the judgment or ruling, they may be held accountable for refusing to enforce the judgment or ruling. If the debtor transfers property during the litigation, the creditor may file a lawsuit for revocation of rights to recover the property. If the debtor temporarily has no property available for enforcement, the court may terminate the current procedure and resume enforcement at any time upon discovering new clues. The creditor's rights will not be extinguished. The lawsuit itself also interrupts the statute of limitations, leaving room for subsequent claims.

Q5: Can I still sue someone for a loan note after three years have passed?

You can file a lawsuit, but the court will not actively review the statute of limitations. However, if the other party raises a statute of limitations defense, you may face a loss in the lawsuit. If there have been written collections, account reconciliation, partial repayments, or the other party's promise to repay within three years, the statute of limitations is interrupted and starts anew (Article 195 of the Civil Code); if the other party voluntarily repays or agrees to repay after the statute of limitations expires, they may no longer raise a statute of limitations defense (Article 192 of the Civil Code). The remedy is to have the other party re-issue a repayment commitment, a payment plan, or sign and confirm on the collection letter, thereby reactivating the statute of limitations and then filing a lawsuit.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, to avoid missing the statutory time limit. →\nLegal services for creditor-debtor disputes·Beijing Henglu Law Firm