What Is External Commercial Borrowing?

Commercial loans are loans used to supplement the working capital of industrial and commercial enterprises. Generally, they are short-term loans, usually 9 months, up to a year, but there are a small number of long-term loans. This type of loan is the main component of commercial bank loans, and generally accounts for more than one-third of total loans.

Commercial loans

1. Submit a loan application : After you have signed the house sale contract, you can apply for a commercial loan from the bank. Whether it is a first-hand or second-hand mortgage, you need to submit all the materials approved by the bank to the bank for review, which is the most important step in the commercial loan process.

It mainly includes identity cards, hukou books, original marriage certificates and photocopies; non-resident registration requires a temporary residence permit or residence permit; income certificate issued by the work unit; sales contract, down payment invoice or receipt; salary flow or other asset certificates in the past six months. In addition to the above five materials, different banks have different requirements for commercial loans, and they must also ask for other information required by the loan banks in detail.

2. The bank accepts the investigation: after receiving the loan applicant's application materials, the bank will review their materials. The general review time of commercial loans is 15 working days, and the longest is no more than 1 month.

During the bank's investigation, the loan applicant will be required to add some information according to the situation. Therefore, the loan applicant must keep in touch with the bank during this period.

3. Bank verification and approval: The loan bank will verify for several aspects: the condition of the house, the qualifications and credit of the borrower, and so on. This is a relatively important part of the commercial loan process. If the credit of the loan applicant is bad, it will directly lead to the failure of the loan application, so it is important to accumulate good personal credit in life.

4. Both parties go through the relevant formalities: the bank informs the loan applicant that after the loan approval is passed, it is necessary to open an account with the bank, obtain a debit card and sign a loan contract. At the same time, handle mortgage, guarantee, pledge and insurance related guarantee procedures. When signing a loan contract and handling guarantee procedures, you must understand the detailed rules in the contract in detail, and clarify your rights and obligations to avoid unnecessary misunderstandings.

5. Loans issued by banks: After all the loan procedures are completed, the bank will deposit the loan funds into the account of the real estate developer.

1.Ordinary commercial loans

2.Fast business loans (need to use buyer's loans to settle and provide through guarantee institutions

1. All branches within its jurisdiction.

   Commercial loans	Benchmark interest rate	Interest rate floor	Interest rate cap
   Within 6 months (inclusive)	1.86	1.402	1.346
   6 months to 1 year (including 1 year)	1.31	1.717	1.841
   1 to 3 years (including 3 years)	1.4	1.780	1.940
   3 to 5 years (including 5 years)	1.76	1..032	1.336
   More than 5 years	1.94	1.158	1.534

   The People's Bank of China has decided to reduce the RMB deposits and loans of financial institutions since June 8, 2012

   Advantages: Less restricted conditions and various repayment forms. Commercial loans have no restrictions on whether lenders can pay for housing provident funds. As long as the down payment reaches the ratio required by the bank, they can apply for loans with a good credit limit. The application process is relatively simple.
   
   Disadvantage: High loan interest rates. The disadvantage of commercial loans lies in their high interest rates. Due to the higher interest rates of commercial loans, the interest on mortgages generated also ranks first among several mortgages.