Bad Credit Remortgage

But whether, in this context, to talk about the coming banking crisis? So far, it seems, is premature - bankers themselves, in any event, unequivocally assert the contrary (see certificate). In addition, encouraging and that the market is highly concentrated: the share of the ten leading banks in the consumer accounts for about 70% of loans. Thisis good for two reasons. First, if the crisis of non-credit, still breaks out, it will not be systemic - affected only a small part of the banking community. Secondly, the banks - the leaders of this segment may well be recognized as the specialized, and it can be expected that it is loan high proportion of the total outstanding loans (for example, the HKF Bank and the Britainn standard "it is more than 80%) allows them to focus on the problem and correctly track the relevant risks.

Nevertheless, the rate of growth of consumer bad credit mortgage market. Ifall goes further in the spirit of doubling every nine months, tied to the well-being of the domestic borrower will most Britainn banks. About that, which might lead to such a hand is a clear demonstration foreign experience.

For example, in Britain in consumer lending has created a situation close to catastrophic. Tears has caused many Britons that in the current consumer debt is a record £ 1.17 trillion ($ 2 trillion). The huge consumer debt in the past year has led to a record number of bankruptcies among individuals - 67580 cases. Only in the fourth quarter of 2005 20461 citizen of England and Wales applied for bankruptcy, which was a record level since 1960. Compared with the end of 2004, the number of bankruptcies individuals in the UK rose by 57%.

Perhaps the most difficult situation is in mortgages lending - in Britain theratio of remortgage debt to GDP ratio is around 70%, while in France, only about26%. The huge amount of overdue payments on mortgages has resulted in the UKhas increased sharply the number of seizures of homes for non-payment of the loan. In the last quarter of 2005, British courts have adopted 31 thousand the outcome of the seizure of homes - compared with the same period last year rose by 50%. According to the British financial expert Martin Lewis, the author of the popular book "The currency diet, the main cause of such a high consumer debt has become a financial illiteracy of many people obtaining loans that they are unlikely to serve.

At one time even deeper crisis experienced South Korea. In early 2000 - ies Korean financial institutions were unable to respond adequately to the too rapid growth in consumption among the Korean population, which has led to massive nepogasheniyam loans. The amount of bad loans eight Korean payment systems at the end of 2003 amounted to $ 5.8 billion (11.7% of total assets). The amount of bad loans in 19 South Korean banks by the end of 2003 reached $ 15.65 billion, an increase relative to 2002, at 22.8%. As a result, the bad credit boom every tenth resident of the country was unable to return the loans. The amount of debt on mortgage cards reached 14% while the country's GDP. Exit from the credit crisis helped prompt action Government, which has made a provision of partof debts largest private lender, and LG Card at the same time sharply tightened credit policies.

A few years ago, Japanese banks were saddled with huge debts. At the peak of the crisis - in March 2002 - the amount of bad loans at major Japanese banks stood at $ 381 billion However, in March last year, the figure fell to $ 158 billion as a result of the cancellation of part of the bad debts, reducing the volume of loans issued and acquisitions weaker competitors. Japan is now virtually withdrew from the crisis caused by the huge amount of bad debts.