Mortgage and guarantee of the banking practice

• Main Authors: CHIH-HUNG CHEN, 陳志宏
• Other Authors: Gung-Yeu Jeng
• Format: Others
• Language: zh-TW
• Published: 2011
• Online Access: http://ndltd.ncl.edu.tw/handle/18342518431136471927

碩士 === 東吳大學 === 法律學系 === 99 === In recent years, people have acquired more knowledge of law and are more concerned with the fairness and legitimacy of the trade they make in their daily life. In a prosperous modern society, getting a bank loan is indispensible because industries are in need of money. However, the adhesion contract consumers sign with the bank is unfair and against Freedom of Contract because the bank gains the upper hand and leaves consumers little room to bargain. The Right of Things Law in Taiwan, amended in 2007, has brought a new style and influenced banks' loan-offering. The concrete and definite rules, especially the mortage regulations and its confirmations, serve as the legal basis for banks to follow when giving a loan. Now, in addition to the property the borrower has to put up as a collateral, the bank also asks the borrower to offer joint and several guarantee to protect its right of debt. According to the nature of debt, the contracts signed with joint and several guarantee are classified into two types: specific debt guarantee and maximum debt guarantee. The guarantees for the individual loan and corporate loan are different. According to the current regulations, the bank can not ask the borrower to offer joint and several guarantee if full collateral has been put up for a housing loan or a consumer loan. Earlier this year, the Consumers' Foundation, Chinese Taipei filed lawsuits against several banks in Taiwan for this regulation. The fact that people nowadays have more knowledge of law has led lawmakers to favor public opinions and intend to abolish the contracts signed with joint and several guarantee. What's more, the local financial institutions are losing the position of advantage in competition with foreign banks because the authorities are overly concerned about banks' loan-offering due to the rise in consumers' awareness. Suggestions are as follows: 1. Too much intervention in the requisition for a guarantee may decrease the banks' loan-offering business and influence the flow of capital, which is not good for economic development. 2. The mechanism of free market should be respected, the level of people's knowledge of law should be enhanced, and the system of requiring a guarantee should be running in accordance with regulations. 3. When banks sign a contract with a guarantor, the terms and duties should be fair and clear so as to avoid controversy or cost increase. 4. Banks should not be over-loaned or transfer all the risk-control to guarantors. Loans should be given in a fair manner.