Common use of Sequence of repayment Clause in Contracts

Sequence of repayment. 3.7.2.1 Unless otherwise agreed by and between the two parties, the repayment of the borrower shall be made in the following sequence: (1) In case of several due debts between the lender and the borrower and repayment of the borrower is insufficient to pay off all the due debts, the debt repaid and the sequence of offset shall be determined by the lender; (2) In case the lender exercises the right of offset to the borrower according to laws and this contract, the offset debt and sequence shall be determined by the lender; in case the lender exercises right of subrogation according to laws, debt paid off by subordinate debtor and the sequence of oddest shall be determined by the lender; 3.7.2.2 In case the repayment of the borrower is insufficient to paying off the debts repayable, the lender could select to use the repayment for paying off principal, interest, default interest, compound interest, or fees for realizing creditor’s right.