China's Commercial Banks Personal Housing Mortgage Loan Default Risk

With the increase of real estate mortgage in our society, default risk, as the most important factor for the merchant bank to control, has attracted more and more interest from practical field and academic field. But our merchant banks have not realized that the personal house mortgage also has great potential risk. Focusing on the competition with each other in the field of real estate mortgage, they have not paid enough attention to the default risk control. So it's very necessary to research on this kind of risk and give our merchant banks some constructive suggestions based on the research.Real estate mortgage has developed for more than one hundred of years in the west countries, and their merchant banks have constructed effective systems to keep the default risk under control. And the economists also paid much attention to this field. Especially, economists broke through in research on the models of default risk during the past decades.Based on the reference papers and analysis of the data of our merchant banks, this paper gets a conclusion: the default risk of real estate mortgage will increase in the near future. To avoid the losses of their loan, our merchant banks should do these things: firstly, the merchant bank staffers should pay more attention to the default risk. Secondly, the merchant banks should improve on the technology of default risk control. Thirdly, the merchant banks should modify the progresses of real estate loan so that they can get a better inner control merchandize. Finally, they should appeal to our government for the construction of personal credit system.