The house loan contract and the house sales contract are two completely different contracts. Although they are both caused by the house, the execution of the contracts is independent of each other. This means that no matter what happens to the house, including damage and collapse, it will not directly affect the execution of the housing loan contract. If the house collapses due to the earthquake, the house buyer will still need to continue to repay according to the contract. The earthquake caused the house to collapse, but the mortgage still had to be repaid!

If the house is gone, the mortgage still needs to be repaid. From an emotional point of view, many people cannot accept this. Natural disasters such as floods, earthquakes, etc. are force majeure. If a house collapses due to force majeure, the bank may allow the house buyer to temporarily suspend repayment from a humane perspective, and the mortgage extension period will not be included in the personal credit report. How will the bank handle it?

Everyone must still remember the serious disaster that the Wenchuan Earthquake brought to the Chinese people, with huge casualties and property losses. Regarding the issue of loan repayment after the earthquake, the central bank and the China Banking Regulatory Commission issued a special emergency notice requiring all banks to refrain from collections, interest penalties, and bad records for entities and individuals who cannot repay various loans on time. Loans that have been issued before the disaster but cannot be repaid on time after the disaster can be deferred for 6 months. There will be no collection, no penalty interest, or bad records before the extension expires.

At the same time, if the lender suffers huge losses, the loan may not need to be repaid. According to the "Emergency Notice on Effectively Writing Off Bad Debt Loans in the Banking Industry Caused by the Wenchuan Earthquake in Sichuan", banking financial institutions must follow the provisions of the "Management Measures for the Write-off of Bad Debts of Financial Enterprises" and must not Debts that cannot be repaid after obtaining insurance compensation, or recovering from insurance compensation or guarantees, should be deemed as bad debts and be written off in a timely manner.

Such a provision leaves a loophole for the lender to no longer have to repay the loan. If the borrower is indeed unable to continue repaying the loan, the bank is responsible for exempting the mortgage loan and the loan losses will be borne by the bank. In other words, after certain conditions are met and the house is gone, the loan does not need to be repaid. Summary

Of course, the relevant financial policies for the Wenchuan Earthquake are aimed at the Wenchuan Earthquake itself and do not apply to losses caused by natural disasters in other regions. Under normal circumstances, if a house collapses due to an earthquake, if there is no national targeted loan exemption policy, the mortgage must still be repaid on schedule.

If a relatively large natural disaster does occur, the country may still introduce a unified policy like Wenchuan's to treat loans as bad debts. In addition, the lender can also apply for civil relief and may be able to obtain certain financial compensation.