[Direct answer]In the Beijing area, the claimant can pursue all claims simultaneously, but there is a cap on the total amount: the part of the overdue interest, penalty fees, and other expenses in private lending that exceeds four times the one-year LPR rate at the time the contract was signed will not be supported by the court. In other words, the claimant has the freedom to choose to pursue all claims simultaneously, but the total amount cannot exceed the four-fold cap; if there are agreed and actually incurred fees for realizing the creditor's rights (such as attorney's fees and litigation fees), these fees will be calculated separately and are not subject to this limit.

1. Problem background and typical scenarios

The loan contract simultaneously stipulates that "the overdue interest shall be calculated at 0.05% per day" and "the penalty for breach of contract shall be 20% of the loan amount" —— can both be claimed after the overdue period? Many people think that they can get everything as long as it's written in black and white, but when they go to court, they find an invisible overall cap; there are also lenders who haven't realized the strategic space of combining the two clauses, and end up losing money unnecessarily.

II. Key points of contention

First, apply the rules and total cap: the coverage of four times the LPR. Second, determine whether the creditor's fees are subject to the cap. Third, apply the adjustment rules for the combination of penalties and interest in other transaction contracts. Fourth, clarify the order of offsetting and settlements and the calculation techniques in litigation.

III. Professional analysis by Henglue Lawyers

This case is handled by Beijing Henglu Law Firm.Li YonghuiAttorney (Practice License No.: 11101199611955812, subject to the document issued by the judicial administrative authority): Agent. First, let’s review the rules on loans: The Judicial Interpretation on Private Lending explicitly states that if the lender and borrower have agreed on the overdue interest rate, it shall be governed by their agreement, but the maximum amount shall not exceed four times the one-year LPR rate at the time of contract formation. If both the overdue interest rate and the penalty fee or other expenses are agreed upon, the lender may choose to claim one or all of them, but the total amount exceeding four times the one-year LPR rate at the time of contract formation will not be supported. Breaking down the rules into three sentences: First, the choice lies with the lender—it’s legal to claim only one or all of them. Second, the "ceiling" refers to the total amount—interest, penalty fees, and other financial costs are added together, not capped individually. Third, the excess portion is simply cut off, without affecting the support of the remaining amounts. Exceptions for fees: Legal fees, litigation costs, preservation fees, and other costs to enforce creditor’s rights can be claimed separately as long as they are explicitly agreed upon in the contract, actually incurred, and supported by valid receipts. These fees are not subject to the four-fold cap. This is the most commonly overlooked "recovery clause" in loan contracts. Including a legal fee clause in the contract allows for an additional recovery channel during litigation. Rules for other transaction contracts: For overdue payments in contracts such as sales and construction projects, the issue of combining penalties with interest on capital occupation shall be governed by Article 585 of the Civil Code. If the agreed penalty exceeds actual damages, the defaulting party may request a reduction. In judicial practice, the penalty is often set at a certain multiple (e.g., 1.3 times) of the actual damages (usually calculated as the capital occupation loss based on the LPR rate). The party in compliance must actively prove the scope and amount of actual damages to establish a "reasonable benchmark" for the penalty. Calculation techniques: The order of repayment offsets follows Article 560 of the Civil Code: - Related costs, interest, and the principal debt are offset in turn. - During litigation, prepare a breakdown table (showing the balance after each repayment)—this serves as the basis for the claim amount and a bargaining chip in mediation. - A party with clear figures always holds a stronger negotiating position.

IV. Practical suggestions and legal basis

The first step is to ensure all terms are fully specified in the contract: overdue interest, penalty fees, and attorney's fees. The second step is to set the maximum claim amount at four times the total debt to leave room for the court's discretion. The third step is to list fees separately: request separate compensation for debt recovery and prepare all necessary documents. The fourth step is to prepare a calculation table in advance: complete the calculation table of the offsetting order before filing the lawsuit. The main legal basis includes Article 561 and Article 585 of the Civil Code of the People's Republic of China, and the Supreme People's Court's Interpretation on the Application of Law in the Trials of Civil Loan Cases. The specific application shall be subject to the currently effective provisions.

5. Henglu Law Firm's Advice

And follow these three rules: You can request both items, but the total amount will be capped at four times the amount; if there's an agreement on attorney's fees, it's an exception; don't forget to mention it when signing the contract; if the penalty for breach of contract is too high, there's a risk of having it reduced, so you need to prepare evidence of actual losses in advance. For issues involving late interest and penalty design, you can seek help through legal channels.Creditor's rights and debts, and enforcement casesThe service includes a comprehensive solution, which can be combined with the review of the contractual penalty clauses.Business and contract disputes in enterprisesFor reference, you can refer to the drafting of the loan agreement when dealing with platesSpecialised legal servicesFor reference, you can check the sections related to debt enforcement and preservation of rights in the Civil Procedure Law of the People's Republic of China.Intellectual property protection and corporate lawPlate consultation.

VI. Frequently Asked Questions

Q1: Can the overdue interest and the breach of contract penalty be claimed together?

Yes. You can choose to claim either one or both of them, but the total amount shall not exceed four times the one-year LPR rate at the time the contract was concluded.

Q2: What is the total limit?

The total amount of interest, overdue interest, liquidated damages, and other financial-related fees shall not exceed four times the LPR. Any amount exceeding this limit will not be supported by the court.

Q3: Can the attorney's fees be claimed separately?

For cases where there is a clear agreement and the expenses for realizing the creditor's rights have actually occurred, the expenses can be claimed separately and are not subject to the four-fold cap. All necessary documents must be provided.

Q4: If the penalty for breach of contract is too high, will the court reduce it?

If the penalty for breach of contract in the transaction contract is excessively higher than the actual losses, the breaching party may request a reduction. The court often adjusts the penalty based on a certain multiple of the losses.

Q5: Should the repaid money be applied to the principal or the interest first?

The offset shall be made in the order of the costs of realizing the creditor's rights, interest, and the principal debt; if there is an agreement on priority, the statutory order shall apply if there is no such agreement.

The above answer is based on the judicial practice in Beijing. The adjudication standards in other provinces and cities may vary. For specific cases, please refer to the local rules and evidence situation.

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

Disclaimer: This article is compiled based on the current effective laws and regulations and publicly available adjudication rules, and is provided for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. In the event of a dispute, please consult a practicing lawyer in a timely manner.