Analysis And Prevention Of Default Risk Of Personal Mortgage Loan In China

With the rapid development of China's economy and the improvement of people's living standards,China's financial industry has entered a period of prosperity and the competitive pressure of commercial banks is also growing.Personal housing mortgage loan has the characteristics of small risk and long term,which is of great significance to improve the structure of bank assets,prevent and defuse financial risks,so the major banks are going to carry out personal housing mortgage loan business actively.With the continuous increase in the total amount of personal housing mortgage loans,the risks hidden in them are gradually emerging,especially the risk of default.The country is in the transition phase of economic regulation and control,due to the lag effect of the policy,the risk of default has not really exposed in the context of high housing prices.However,with the increase of the national real estate control policies and the negative impact of the decline in GDP growth rate,the rate of personal housing mortgage loans increased and the risk of default has exposed.If the borrower's ability to credit and real estate price are declining,interest rate is rising in the duration of the loan,borrowers will choose default and the bank will face the risk of default.China's commercial banks carried out personal housing mortgage loan business late and lack of appropriate risk control means,so the accumulation of default risk is growing.Once the outbreak of large-scale default risk,it will have a great negative impact on the stability of the financial system as well as the smooth and healthy operation of the entire macroeconomic.This paper combines theoretical analysis and case analysis and from two aspects of macro and micro analysis the reasons for the default risk of personal housing mortgage loan.Macro factors include the level of economic development,changes in the real estate policy,changes in house prices and interestrates in four areas.Micro factors mainly from borrowers,real estate developers and banks themselves elaborate the reasons for the formation of default risk.Based on the analysis of the forming factors of the default risk,this paper puts forward some suggestions on the default risk management of personal housing mortgage loan.