All About Auto Loan You Should Know(5)
The extraordinary development of the auto credit business has indeed brought profits to banks. While sharing the joy of the auto loan "cake", the rising rate of auto loan defaults is a wake-up call for the banking industry.
For banks, auto loans and mortgageloans belong to the same personal loan business, but the two risks are very different, first of all, the car relative to housing, with fixed and liquid. Housing has its fixed position, while cars are not, and they have a lot of mobility. Cars can be moved and can be in China Mobile. If a customer maliciously flees debt, he can move the vehicle to escape or hide; It's more credit risky than a mortgage. Third, auto loans relative to the mortgage, the loan term is short, the amount of repayment is large, the loan recovery is fast, with the characteristics of short and smooth. So the risk of auto loans is faster and higher than the mortgage.
The falling price of automobiles, so that auto loan customers more and more unbalanced repayment mentality, the anger out of the bank for no reason. A customer who has handled a auto loan in the bank said that he was really uncomfortable when he looked at the price of the car and overstated it, thinking about the monthly bank auto loan repayment.
Many uncertainties of auto loan itself indicate that the bank auto loan business has a higher risk content. The release of the risk content of auto loans makes the default rate of banks appear. According to the relevant bank auto loan statistics, the default rate of auto loans has increased significantly in recent years, reaching 0.5% to 0.9%, some of which have exceeded 1%. More troublingly, default rates are rising.
The ultimate victim of bad loans is the bank itself. After anticipating the risk of auto loans, insurance companies quickly responded by closing the auto loan guarantee insurance business in 2003. The risk of bank auto loans is unscathed for car dealers. In the whole auto credit business, auto dealers with the support of bank auto credit to obtain large profits, car credit with auto loans and transfer to the bank, this risk with the number of car dealer auto loans increased, seriously affecting the quality and profit of the bank auto loan business. Faced with relentless auto loan risk, the bank was helpless to bear all the bad debt losses.
In fact, the cause of auto loan risk is multi-party, prevention and disposal is not limited to banks.
As far as The former Chinese society is concerned, the lack of integrity consciousness and the imperfection of the credit system, and the limitation of moral concept, directly affect the degree of automobile credit risk. According to the survey, the legal environment is better, moral, honesty awareness and credit system is better in the region, the default rate of automobile credit is lower, on the contrary, it is higher. A friend of the north once seemed to say that there, if the bank went to collect debts, they needed to take a wolf dog.
Banks can recover customers who owe late and recover their remaining loans through judicial proceedings, but long litigation periods and difficulte with execution have sometimes forced banks to take a new path.
The large number of auto loan risk emerged, so that the bank to different extents to raise the threshold of auto loans, strict approval of auto loans. For example, cooperative car dealers in accordance with sales to the bank to provide financial guarantees, joint car dealers to prevent auto loan risk, increase the auto loan customer guarantee, reduce the number of loans, shorten the term of auto loans, auto loan customers generally selected, good and better.