Workaround: banks have found a way to give money to borrowed customers
This year, banks have sharply - at least five times - increased the issuance of non-purpose loans secured by a car. They use this kind of trick to circumvent the Central Bank's limits on lending to borrowers with a high debt load. This is stated in the materials of the Central Bank, the information "Izvestia" confirmed the director of the Department of Financial Stability of the Bank of Russia Elizaveta Danilova. According to her, this practice is fraught with risks for both organizations and borrowers. Therefore, from the middle of next year, the regulator plans to introduce quantitative restrictions on the issuance of such loans.
Why the Central Bank is concerned about the increase in lending against the pledge of cars
Banks have become more active in offering non-purpose loans secured by a car. Consumers are not only constantly faced with advertising offers of this type of borrowing. Such a way out is offered by specialists of credit organizations to borrowers who are forced to refuse due to high debt load. This practice causes concern of the regulator.
- We see that the issuance of non-purpose loans secured by a car has increased very much, - told "Izvestia" Elizaveta Danilova. - If until 2023 their share accounted for only 1% of loans issued, now this share has increased - in October, five times.
In some banks, the share of such borrowings this year and grew from zero to half of the loans granted, noted in the materials of the Central Bank.
As explained by the Director of the Financial Stability Department of the Central Bank, this may be due to the fact that since 2023 the regulator has established macroprudential limits (MPL, quantitative restrictions on the share of loans to borrowers with high debt load), but for collateralized lending, including when the car as collateral, this measure does not apply.
Thus, pledging a vehicle as collateral allows some banks to reduce the regulatory burden, as such loans are not included in the calculation of the MPL, the Central Bank concluded.
- We can see that in this segment there are quite a lot of borrowers with high debt load indicator (the debt load indicator is calculated as the ratio of the sum of payments on all loans to the monthly income of the borrower, the debt load indicator 50+ means that he spends more than half of his earnings on servicing the loan. - Ed.), who spend more than half of their income on repayment of obligations, - said Elizaveta Danilova.
For example, in the II quarter of 2024, 79% of non-purpose loans secured by a car were issued to people with a PDN 50+, of which 43% - to borrowers with PDN 80+. There was a slight decline in Q3 after the Central Bank introduced additional surcharges on this type of lending. However, even at that time, about 30% of non-targeted consumer loans secured by vehicles were granted to borrowers with an APR of more than 80%. This is significantly higher than the same indicator for unsecured loans, which is 13%.
It would seem that collateral should reduce risks, but not in the case of non-purpose loans secured by a car. Thus, the share with overdue payments over 30 days in the third month of the life of the loan is 1.6% (1.2% for cash loans, 0.9% for car loans).
- Banks underestimate their own risks and lend to citizens, as due to the lack of macroprudential limits actively lend to citizens with high debt load, using the possibility of collateral, - said Elizaveta Danilova.
Risks of lending against the pledge of a car for borrowers
Clients with a PDN above 50%, and even more so 80%, increase their credit load even more, agrees the head of the project "For the Rights of Borrowers" Evgenia Lazareva. Accordingly, the risk of delinquency is also growing.
- A pledge of a car is a guarantee of repayment of credit funds. If the money is not returned, the lender seizes the car and then sells it through partner car dealerships. At the same time, the borrower has to repay the body of the debt, interest for the use of the loan and penalties," the expert explained.
There are many more pitfalls that many people may not even realize, said Evgenia Lazareva. And banks will not even tell about all the most important conditions of such loans until the last. The Izvestia columnist was convinced of this, having called several organizations that are most active in promoting consumer loans against the pledge of a car.
Ordinary employees of call-centers could not give additional information to that published on websites and in advertisements. This was followed by numerous switches to specialized "specialists". In one of the banks there were four of them, and the total call time amounted to almost 42 minutes. However, even this time was wasted, as the "specialists" could not answer the most pressing questions: whether an additional contract (agreement) is needed to continue using the pledged car, what happens if the car breaks down or gets into an accident with no possibility of restoration, and so on. It was difficult to tell even how the car is valued. One organization said that it is done by the employees who issue the loan.
- According to the results of the appraisal they give 70-50% and below of the market value for the car, depending on its condition. But since it is a loan and there are annual interest rates for 3-5 years, and the price of the car becomes lower with each year of operation due to depreciation, you will have to pay back more than the cost of the car, - said Evgenia Lazareva.
In general, this type of borrowing is more expensive by 5-6% than classic car loans.
- Moreover, if the borrower faces difficulties in servicing the debt, it may entail a revision of the interest rate or realization of collateral, which significantly worsens his financial situation, - said Alexander Terentyev, a forensic expert of the Veta expert group.
He also pointed out that many banks require not only standard life and health insurance contracts, but also expensive hull insurance. Otherwise they raise the rate even more. Also, one of the banks told Izvestia that they will increase the rate by 10% if the car gets into any accident.
- And in the case of serious damage or complete loss of the car as a result of an accident, the situation for the borrower becomes critical. If the car can not be restored, and the insurance indemnity (if there is insurance) does not cover the balance of the debt, he is obliged to continue paying on the loan, no longer having the collateral. In this case, the bank has the right to demand full early repayment of the loan or provision of other collateral, - warned Alexander Terentyev.
Because of what you can lose your car when you take a consumer loan for it
And most importantly - some banks have begun to offer to sign two more agreements - the contract of sale and lease, said Eugenia Lazareva. That is, the borrower sells the car to the bank and leases it from it, in which experts see serious risks.
A special danger is the scheme of return leasing, which is not actually regulated by the legislation and can lead to the complete loss of the car even with a slight delay in payments, confirmed Alexander Terentyev. At the same time, the borrower remains indebted to the loan despite the seizure of the collateral, he added.
- When concluding leaseback transactions, lenders may include in the contracts terms limiting the territory of the car location to the boundaries of the region or settlement. Such contracts may contain any penalties, up to the seizure of the car. At the same time, it happens that the car is towed without warning the borrower and personal belongings in it are not returned," said Evgenia Lazareva.
The Central Bank is already trying to correct the banks' dubious practices. Thus, in July this year, the regulator established, and from November 1 increased the premiums to risk coefficients for non-purpose loans secured by a car. And from the middle of next year, it plans to set quantitative limits on this type of lending, said Elizaveta Danilova. The legislation has already been amended to give the Central Bank such a right, she reminded.
