Vehicle pledge, also known as automobile mortgage, refers to a loan method that mortgages private vehicles (including private cars and commercial vehicles) to financial institutions to obtain certain funds. The essence of vehicle pledge is to obtain loans with vehicles as collateral. When the loan term expires or the lender fails to repay the loan principal and interest in time, the collateral (vehicle) will be recovered by the financial institution and auctioned to obtain the due value of the collateral.

Vehicle pledge has the following characteristics in solving the capital demand: first, the vehicle pledge process is simple, and the pledger only needs to provide the vehicle registration certificate without providing too many complicated materials; Secondly, the loan amount is relatively high, which greatly reduces the loan threshold, and the loan can be used for various consumer needs; Finally, the vehicle pledge time is short, and it usually takes about a week to lend money, which is very attractive.

The risk of vehicle pledge is mainly reflected in two aspects: first, the loan interest rate is high; The second is the potential safety hazard of pledged vehicles. For the first point, compared with financial channels such as bank loans, the loan interest rate of vehicle pledge is higher, and there are some unreasonable additional fees, so consumers need to have enough repayment ability to borrow. For the second point, the pledgee needs to ensure the safety of the vehicle through vehicle inspection and insurance, otherwise, once the vehicle is stolen or damaged, the lender will face the risk of insufficient collateral.