China's Commercial Banks Personal Housing Mortgage Loan Risk Prevention

Nowadays, financial risk has become the most significant, and more and more centralized kind of social risk. Financial risk is greatly harmful to economic and social development, because it can not only make an individual financial institution suffer great loss, but also may destroy the stable economic order in a country or region and even the whole world, which thus leads to social turbulence. Personal real estate loan is a financial product that was brought in during the transformation from the welfare housing allotment system tomagnetization of housing allotment. This product refers to the loan made by the credit giver to the credit receiver for purchasing personal common real estate. According to the current situation of housing banking development in China, the activities of personal real estate loans fall into three major forms: one of them is personal real estate loan supported by policy; the other is commercial personal real estate loan. With the deepening reform in housing system, personal real estate loan is playing a increasingly significant role and becoming a important instrument employed by residents for housing purchasing. Banks also favor personal real estate loan, which is characterized by low risk and high yield, for it ban help banks to adjust credit structures and improve assets quality. On the other hand, long repayment term and low liquidity yet determines that personal real estate loan is not a low-risk activity in the full sense. Moreover, as the credit environment in China is not good enough, related laws and regulations are not sound, the development of financial products is imperfect. The risk management is not mature and vicious competitions often occur while banks are scrambling for more activities, the risk of personal real-estate loans should not be ignored. How to guard against and control risks has not only been the focus of commercial banks' concern, but also become a problem to be settled urgently, which otherwise would affect the further healthy and rapid...