There are credit and fraud risks in long-term lending. Most long-term loans are almost vicious in the end. Without the existence of the receiver, they can only suffer in the end. Multi-head lending refers to the behavior that a single borrower puts forward loan demand to two or more financial institutions. Generally, many long-term borrowers are unable to repay their loans because of financial difficulties, and they adopt the method of "repaying loans with loans", resulting in more and more debts.
Long-term borrowing is not necessarily a bad thing, but excessive long-term borrowing leads to problems in the borrower's repayment ability, forming the last straw to crush the camel.
This kind of long-term lending behavior may encourage borrowers to borrow excessively, and the platform lacks credit information, which usually contains high risks. When the market criticized the high interest rate of cash loans, the online lending platform suffered bad debts from long-term lending.
Because for borrowers, many small online lending platforms are simple, convenient and fast to operate, and it is easy to enjoy the feeling of successful lending, and it is easy to become addicted over time. For those who have applied for online loans, long-term lending is a very common thing.
However, the damage caused by long-term loans is heavy and the shortcomings are clearly visible. Once one or two online lending platforms fail to apply, the loans of other online lending platforms will be overdue in a large area, resulting in a "domino effect". When the lender fails to "tear down the east and fill the west", it is the time when the crisis breaks out. So most borrowers eventually died of long-term borrowing.
According to statistics, the credit overdue risk of multi-head borrowers is 3-4 times that of ordinary customers, and the default probability of loan applicants increases by 20% every time they apply for an institution. The reason is that these users often borrow the new and return the old, or increase the new large consumption, and the principal plus interest leads to the continuous accumulation of debts. When the repayment capacity is exceeded, you can only choose overdue. Fraud caused by multi-head lending can not be ignored, which not only leads to financial risks, but also causes some social problems.
However, long-term borrowing also has many negative effects on individuals. For example, if there is no overdue payment, it will affect the credit investigation. Borrowing from multiple platforms can easily lead to the disclosure of personal data and eventually lead to desperation.
Finally, when applying for every loan, friends who want to borrow money must think clearly and make a serious decision, and try not to let themselves fall into a dead end of long-term borrowing.