What is the meaning of bad debts in bank loans?

It refers to the receivables that have passed the payment deadline, cannot be recovered after being called, are in a sluggish state for a long time, and may become bad debts.

The borrower and guarantor declare bankruptcy, closure, dissolution or cancellation in accordance with the law, and terminate their legal person qualifications. The financial enterprise recovers the debt from the borrower and guarantor but cannot recover the creditor's rights.

After the borrower dies, or is declared missing or dead in accordance with the provisions of the "General Principles of the People's Republic of China and the Civil Law of the People's Republic of China", after the financial enterprise has paid off its property or inheritance in accordance with the law and has recovered the guarantor, Uncollectible claims.

If the borrower suffers a major natural disaster or accident, suffers huge losses and cannot obtain insurance compensation, or is truly unable to repay part or all of the debt after being compensated by insurance, the financial enterprise shall repay its property and the guarantor. Claims that cannot be recovered after recovery.

Extended information

Methods for handling bank bad debts

1. Handling of two special situations:

(1) "Overpayment" The bad debts caused, for example, you owe 8,999 to **Bank's credit card, and you repay 9,000. If you pay an extra dollar and don't withdraw it for a long time, bad debts will also be caused. The method of handling it is to withdraw the excess payment and cancel the account.

(2) Bad debts caused by "card annual fees" are relatively simple to deal with. Just pay off the outstanding balance and close the account. Banks will generally actively deal with bad debts caused by these two situations.

2. General bad debt processing:

After the bad debts are generated due to arrears, pay off the arrears in a timely manner (note that you cannot pay back a penny more), and cancel the account. Please pay attention to The account must be closed. If the account is not closed, bad debts will be reported to the credit card, so this is different from the general method of handling overdue credit cards.

After canceling the account, you will find that some banks will update you quickly and even classify your account into non-overdue accounts. However, some banks are very bad and will still have bad debts even after canceling the account. The handling method was negotiated many times, but it was impossible to object.

Reference material Baidu Encyclopedia - What is the meaning of bad debts?

Bad debts refer to debts that have passed the payment deadline and cannot be recovered after being called. They are in a sluggish state for a long time and may become bad debts. Collect payment. Bad debts are the result of failure to clear accounts in a timely manner, and also refer to financial resources that cannot be recovered because the other party does not repay.

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Conditions for write-off of bank bad debts:

1. Commercial banks must comply with legal provisions to withdraw bad debt reserves and write off bad debts. Only under the procedures and within the scope can commercial banks write off their bad debt reserves. The bad debt reserves set aside by commercial banks are used to make up for the following losses of commercial banks:

(1) Loans that the borrower and guarantor are declared bankrupt in accordance with the law and cannot be repaid after scheduled repayments.

(2) The borrower dies, or is declared missing or dead in accordance with the provisions of the "General Principles of the Civil Law", and the loan cannot be repaid after repaying it with his property or inheritance.

(3) The borrower suffers a major natural disaster or accident, suffers huge losses and cannot obtain insurance compensation, and is truly unable to repay part or all of the loan, or the loan cannot be repaid after being paid off with insurance compensation.

(4) Overdue loans approved by the State Council.

2. A hierarchical approval system should be implemented for the write-off of bad debts, the approval procedures should be strictly performed, and bad debts should be written off in a timely manner. Corresponding RMB bad debt reserves should be withdrawn for foreign exchange loans, and cash exchange is not allowed. If losses on bad debts occur on foreign exchange loans, after review and approval, you can apply to purchase foreign exchange to offset the losses on foreign exchange loans.

Baidu Encyclopedia-What does bad debt reserve bank bad debt mean?

Bank bad debts refer to debts in the banking system that are receivable and temporarily paid after the debts mature and the principal and interest of the borrowings are overdue for more than 30 days and the borrowings are in a sluggish state but have not yet been designated as bad debts. payment.

Generally, after a borrower borrows money from a bank, if it is overdue for more than one month and the bank is unable to contact the borrower due to changing mobile phone numbers or other reasons, then the personal debt may be charged by the bank. Included in bad debts.

1. You can protect your rights when bad debts occur.

Bad debts: refer to debts that have passed the payment deadline and cannot be recovered after being called upon. They have been in a sluggish state for a long time and may become bad debts. Bad debts are receivables that are the result of failure to clear accounts in a timely manner, and also refer to financial resources that cannot be recovered because the other party does not repay. Simply put, it is an account that has not been paid off for a long time.

The formation and identification of bad debts: For debts that cannot be recovered after repeated collections (including cases of lost contact), the identification of bad debts needs to be reported to the relevant superior department for approval. The impact of bad debts on us: Since bad debts are a relatively serious overdue situation in Hong Kong Economic News (much more serious than general overdue debts), as long as there are bad debts in Hong Kong Economic News, we will not be able to handle bank business or apply for credit cards and loans. If bad debts are not dealt with, they will remain with you for a lifetime. In some cases, even if you pay off the debt, the bad debts will still remain in the newspaper.

2. Deletion process (good records need to be maintained for 24 months): 1. Submit your personal information and check personal credit report; 2. Raise personal credit objection, and the bank will apply for objection; 3. Fill out the "Personal Credit Report Objection Application Form", and then submit a "Corrected Personal Credit Report" to the commercial bank; 4. Wait for the "Personal Credit Report Objection Reply Letter" from the credit department. If there are no problems, it will be cleared within 5 working days.

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Commercial banks and joint-stock commercial banks generally implement a four-level loan classification system. The four-level loan classification system divides loans into normal, overdue, sluggish, and bad debts. The last three categories, namely "one overdue and two bad debts" are collectively referred to as non-performing loans. This is a classification method that serves fiscal and taxation policies under the planned economic system. The standard for defining non-performing assets is term: loan principal and interest arrears for more than 180 days are "overdue", loan interest arrears for more than three years are "sluggish", and lenders are Those that have escaped death or have been approved by the State Council are "bad debts". The write-off of bad debts must be approved by the financial authorities. The write-off of bad debts is regarded as giving up the creditor's rights, and only the general bad debt reserve (1% of the total loan amount) is required. General bad debt provisions are only related to the total loan amount and cannot reflect the true extent of loan losses.