The nominal borrower is the person who signs the iou and borrows money from the lender, while the actual borrower is the person who actually uses the loan. Judging from the current judicial practice, the mainstream view is that the actual use of the loan does not affect the principle of relativity of the contract, and the signed borrower should bear the repayment responsibility according to the loan contract, unless the nominal borrower discloses the actual borrower to the lender when borrowing, and the nominal borrower does not participate in the performance of the loan contract and does not enjoy the benefits. There are also some views that both the nominal borrower and the actual borrower participated in the loan, which had an impact on the private lending order and should be repaid together.
If the lender signs a loan contract with the nominal borrower, the nominal borrower shall independently bear the repayment responsibility according to the principle of relativity of the contract, provided that the nominal borrower does not disclose the actual borrower to the lender. After the nominal borrower has fulfilled the repayment obligation, it can recover from the actual borrower.
Legal basis:
Article 465 of the Civil Code of People's Republic of China (PRC): A legally established contract shall be protected by law. A legally established contract is legally binding only on the parties, except as otherwise provided by law.
Article 667 A loan contract is a contract in which the borrower borrows money from the lender, repays the loan at maturity and pays interest.
Article 925 A contract concluded by the agent with a third party in his own name within the scope of authorization of the principal, and if the third party knew the agency relationship between the agent and the principal when concluding the contract, the contract directly binds the principal and the third party. However, unless there is definite evidence to prove that the contract is only binding on the trustee and the third party.
Article 926 When the agent enters into a contract with a third person in his own name, the third person is unaware of the agency relationship between the agent and the principal, and if the agent fails to perform his obligations to the principal due to the reason of the third person, the agent shall disclose the third person to the principal so that the principal can exercise the agency right to the third person. However, the third party knows that the client will not conclude a contract when concluding a contract with the trustee.