The reason is.
1. After loans overdue is mortgaged, it needs to go through a series of collection processes, such as SMS reminder, telephone collection, collection notice, door-to-door collection and lawyer's letter collection. If the overdue debt can be recovered, there is no need to auction the collateral.
2. The auction of collateral is often conducted by the people's court according to law. Banks or other financial institutions that provide mortgage services have no right to auction collateral directly, but can only negotiate with borrowers or discount or pay off collateral according to the contents of mortgage loan contracts.
3. Even if the borrower fails to appeal to the court within the time limit, the court will only let the borrower fulfill the repayment obligation in the effective document after the judgment, and will not carry out the original auction.
Unless the borrower refuses to perform the repayment obligation, the court may seal up and detain the collateral according to law at the application of the lending institution, and force the auction to protect the priority rights and interests of the mortgagee.
4. Whether it is the first mortgage loan or the second mortgage loan, if the borrower applies for a loan with the property under his name as collateral, he still has the ownership of the mortgaged property. Even if the repayment is overdue, the mortgagee should inform the owner before the auction according to law, and will not auction directly.
5. The phenomenon in loans overdue is actually very common. It's not once or twice. If it is overdue, it will take a lot of manpower and time to sue in court and apply for compulsory auction. From the perspective of cost and return, it will seem that it is not worth the loss, so it is generally not easy to directly sue the auction.
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What are the bad consequences besides auction after the deadline?
Paying off the auction collateral is generally the last link, which will have overdue influence in the early stage.
1, psychological pressure caused by collection
People with weak psychological defense may be unbearable after being collected several times, and they feel that a big stone is pressing in their hearts, which makes people breathless; People with strong psychological endurance will also be unable to hold on under the pressure of collection for several months. Even if they don't ask, lending institutions can contact family and friends, which will also bring psychological pressure to themselves.
2. Accumulated overdue penalty interest
The overdue penalty interest is usually 0.5 times of the normal interest of 65438+, which is calculated from the first day of overdue until the overdue debt is paid off or the lending institution stops interest voluntarily. Therefore, if the normal loan principal and interest are not due, it will be more difficult to repay the overdue penalty interest and loan principal accumulated after overdue.
3. Report personal credit damage to the central bank.
If the loan maturity date is not up by 24:00, it is overdue. After the deadline, it will be truthfully reported to the central bank for credit according to the regulatory requirements of relevant departments, and will be displayed in the personal credit report. Even if the overdue debt is paid off one day, the overdue record will remain in the credit information for five years, which means that personal credit will be damaged and humiliated for a long time.