Abstract
The purpose of this study is to analyze the factors that cause bad credit to credit agreements between creditors and debtors and to formulate a model of bad credit settlement against credit agreements between creditors and debtors. This study uses an empirical juridical approach. This study found that the factors causing the occurrence of bad credit are due to internal factors of the bank (creditors), namely ignoring bank prudential principles, especially the 5C principle, where banks are less careful in assessing potential debtors, and external factors (debtors), where the debtor's business decreases, debtors are not clever in managing their business, debtors have large debts, credit is not used properly, hidden credit and fictitious credit. The non-performing loan settlement model puts forward the principles of taawun and tawazun, with several stages, namely subpoena, credit restructuring and, / or credit settlement by selling collateral as a last resort.
Highlights
This study found that the factors causing the occurrence of bad credit are due to internal factors of the bank, namely ignoring bank prudential principles, especially the 5C principle, where banks are less careful in assessing potential debtors, and external factors, where the debtor's business decreases, debtors are not clever in managing their business, debtors have large debts, credit is not used properly, hidden credit and fictitious credit
One form of collateral can be in the form of immovable objects, namely land and buildings encumbered with Mortgage Rights in accordance with Law Number 4 of 1996 concerning Mortgage Rights for Land and Objects related to Land, hereinafter referred to as UUHT
According to Article 1 paragraph 1 of the UUHT, Mortgage Rights are rights to land and objects related to land which are security rights imposed on land rights as referred to in the Basic Agrarian Law (UUPA)
Summary
In 2017, the risk of bad credit increased significantly because there were 12 debtors who were unable to pay their debts according to the credit agreement with a predetermined mortgage guarantee. The factors that cause bad credit at the People's Credit Bank of Pura Arthakencana Jatipuro, Karanganyar Regency include: Internal factors of creditors / banks: Banks are not thorough in analyzing customer character.
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