Commercial Banks In Housing Loans Under The Loan Repayment Ahead Of Schedule In Case Of Financial Coping Strategies

The mortgage prepayments behavior refers to the borrower is not in accordance with the original repayment schedule mortgage payments, but the mortgage before the maturity date of any point in time, some or all of the acts of balance to repay the loan. In China, the prepayment risk in China is mainly reflected in the commercial bank earnings impact.For a long time, China’s housing mortgage loan market, there is only a floating-rate home mortgages. In 1998, China has suspended the housing allocation policy, the housing mortgage loans as the main form of urban residents to purchase housing, which is to purchase a house as collateral to bank loans to housing credit modes. In the contract period when the borrower has a loan repayment ahead of schedule capacity will choose to repay the loan ahead of schedule in order to reduce the unnecessary burden of interest, namely, mortgage loan prepayments.Prepayments caused by many factors:the macroeconomic development to increase their savings to borrowers, and other investment income decrease in mortgage interest rates rise, in addition to the transfer of housing and other access to early repayment of capital possible. More recently, with the increase of the phenomenon of China’s early repayment, the borrower to repay the loan in advance of reason to become a hot issue in China’s real estate industry. Repayment in advance of reason can not only increase the borrower’s income, the banking and financial markets also have significant influence, mainly in the following aspects:First, the borrower makes the loan repayment ahead of the expected interest income of banks has decreased, according as the direct economic loss; secondly, to break the bank pre-established financial plan and it has reduced the liquidity of the banking,; again, due to the uncertainty of early loan repayment behavior, enabling banks can not follow the normal loan program to deal with, only to provide additional manpower to complete the various operations, resulting in massive waste of human resources; In the end, increases in bank asset risk management, uncertainty, change the original structure of assets and liabilities affecting the lender benefits.The interest rate increase in 2004 led to a massive wave of advance repayment, the commercial banks, faced with such situations by surprise. In order to compensate the borrower’s prepayment behavior of the risks posed to commercial banks, a few banks began to charge prepayment penalties. What factors will cause the borrower to pay in advance? Prepayment behavior of commercial banks will create what the specific impact?Commercial banks should pay in advance how to cure the problem? In response to these problems, the authors in-depth study on the basis of research results at home and abroad, combined with China’s national conditions, the prepayment behavior and commercial banks, their financial coping strategies to make a comprehensive and in-depth analysis.