What Are the Different Types of Building Society Loans?

The construction industry liquidity loan is a loan issued by the China Construction Bank to the working capital of enterprises in the construction system. The loan objects are mainly construction and installation enterprises, engineering contracting companies, urban comprehensive development companies, building material enterprises, and processing and manufacturing enterprises serving construction projects. The loan condition is that the company must have the status of a legal person, have a sound financial management and economic accounting system and certain own funds, use the loan properly, comply with relevant national guidelines and policies, have the ability to repay, and open an account with a construction bank. The types of construction industry liquidity loans, according to different loan objects, are divided into construction and installation enterprise liquidity loans, foreign contracted engineering enterprise loans, land development and commercial housing loans, engineering settlement loans, infrastructure materials supply and marketing enterprise loans, and other working capital loans. ^[1]

Construction industry working capital loan

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The construction industry liquidity loan is a loan issued by the China Construction Bank to the working capital of enterprises in the construction system. The loan objects are mainly construction and installation enterprises, engineering contracting companies, urban comprehensive development companies, building material enterprises, and processing and manufacturing enterprises serving construction projects. The loan condition is that the company must have the status of a legal person, have a sound financial management and economic accounting system and certain own funds, use the loan properly, comply with relevant national guidelines and policies, have the ability to repay, and open an account with a construction bank. The types of liquidity loans in the construction industry are divided into liquidity loans for construction and installation enterprises, loans to foreign contracted engineering enterprises, loans for land development and commercial housing, loans for project settlement, loans for supply and marketing of infrastructure materials, and other loans for working capital. ^[1]

Compared with the investment loan, the construction industry liquidity loan has the following obvious differences: ^[2]

All enterprises engaged in the production and operation of the construction industry and the circulation of infrastructure materials, opening an account in a bank, implementing independent accounting, self-financing and loss, and having the legal personality of a national ownership and collective ownership enterprise can apply for construction industry liquidity loans. According to relevant regulations, the specific objects of the loan are as follows: ^[2]

(1) Classification by loan object ^[2]

In the past, the liquidity in the production and operation process of the construction industry has been solved by appropriating part of the national budget and receiving part of the advance from the construction unit. This practice of eating hundreds of meals and using funds free of charge does not link the use of funds with the economic benefits of the users of the funds, so that the people who use the funds have time and values, and there is no worry and pressure when it comes to spending money. Attach importance to scientific management, resulting in a backlog of waste of funds. In order to meet the needs of the vigorous development of the construction industry and the reform of the management system, in accordance with the requirements of the State Council on reforming the investment management system of the construction industry, starting from 1985, the working capital of the construction industry was changed to bank loan management. This is a major reform of the capital supply system. Is of great significance. ^[2]

The requirements for an enterprise to apply for a working capital loan in the construction industry are: ^[2]

(1) Application and approval of loans ^[2]

1. In order to obtain a working capital loan, in addition to filling out a loan application, the construction industry must explain the reason, purpose, amount, repayment period, etc. of the loan application, as well as the annual loan plan and other relevant information required by the bank Submit it for bank investigation and approval.

2. Pre-loan survey

After receiving the application for working capital loan from the construction industry and related materials, the handling bank shall carry out pre-loan inspection in accordance with relevant regulations. The pre-loan survey can be based on macro and micro aspects.

The macro survey includes:

(1) Investigate the scale of investment and construction in the entire region, determine the total amount of construction tasks and commercial housing development in the region, and calculate the total annual demand for working capital loans in the construction industry.

(2) An overview of the survey objects, that is, to investigate the number of each type of loan enterprise, production and sales capacity, and determine the demand for loans based on the scope of the loan regulations.

The main contents of the micro survey include:

(1) Whether the production (development) tasks of the enterprise are fulfilled;

(2) The proportion of key projects in the contracted projects of enterprises and the implementation of their funds;

(3) the ownership of the company's own funds;

(4) the level of capital occupation and its changing trend;

(5) Whether the internal organization of the enterprise is reasonable, whether the various management systems are sound, the level of management personnel, technical personnel, and the proportion of all employees;

(6) The economic benefits of the enterprise, such as the labor productivity and profitability of the entire staff;

(7) The reputation of the enterprise in the construction market, including the quality of the project, the performance rate of the construction period, and the past loan return situation;

(8) Through the survey of the planned workload, own funds, and other financing channels of the enterprise within a certain period of time, and taking into account the speed of capital turnover, calculate the total demand for bank funds by the enterprise.

For real estate development enterprises, in addition to the above-mentioned pre-loan survey, they must also find out the basic situation of the development project and the sales situation of local commercial housing. The investigation will determine the key points of loan support, and determine the amount and scale of loan disbursement to ensure the normal turnover of bank credit funds.

3 Approval of loans

After the pre-loan investigation, the investigator should sort out and analyze the investigation content, submit an investigation report, and submit it to the company for approval along with the application for the corporate loan and the annual working capital loan plan. Each handling bank shall strictly follow the examination and approval procedures for examination and approval, and implement a three-level examination and approval system of loan officers, credit officers, and presidents (or loan approval teams) within the examination and approval authority to institutionalize and standardize. For an unapproved loan, no individual shall make any external commitments in any form, nor shall he decide to grant the loan without authorization.

(2) Signing of loan contracts

After the borrower's loan application is reviewed and approved by the bank, the bank shall promptly notify the borrower to sign the loan contract. The loan contract shall be signed by the legal representatives of the two parties or the person authorized by the legal representative and affixed with the official seal of both parties, which shall have the legal effect, and both parties shall strictly enforce and abide by the credit.

For loans that need to be mortgaged or guaranteed as required, the handling bank shall investigate the qualifications of the guarantor and the ability to guarantee or mortgage the property. In the case of a property mortgage loan, both parties to the loan must sign a mortgage contract, and a third-party guarantor provides an irrevocable loan guarantee agreement, which is notarized as an attachment to the loan contract. For general borrowing companies, loans can be used for property mortgages; for companies with good economic returns and high levels of credit, they can be exempted from guarantees; other companies can take third-party guarantees.

(3) Loan disbursement

After the signing of the loan contract takes effect, the handling bank shall fill out the "Approval of Loan Indicator Notice" according to the loan type, amount, term, and interest rate stipulated in the contract, and send the approved indicators to the relevant departments within the enterprise and the bank for issue. loan.

Within the scope of the approved loan indicators, the enterprise may transfer the loan funds to depositors one or more times according to the loan plan and actual needs. After the loan enters the corporate deposit account, the enterprise uses it for its intended purpose.

(IV) Repayment of principal and interest on loans

The construction industry working capital loan must be repaid on the date stipulated in the contract. Recover loan principal and interest on schedule. It is the ultimate purpose of bank credit management-and it is also the bank's capital recovery. Guarantee to improve loan utilization.