How do you buy a car on a loan for example?
It's not perfect but unlike both your examples it isn't based on things that could be consider political. You can't lower your credit score by attending a protest for example. Or posting things for or against causes on the internet.
I am just honestly wondering what else is our there? It has always seemed like a tool that can be used by both individuals and lenders.
The key values used by banks is essentially two ratios, loan vs collateral, and monthly loan payments vs monthly income; so the question isn't about whether to grant a loan but what is the maximum amount they are willing to risk given your income.
When the stock price dropped and started to make margin calls on the loans, some of the banks had to take a loss as there wasn't enough liquidity to sell into.
banks don't like to be in this sort of situation - in this particular case, the banks just didn't do enough due diligence presumably.
A car loan is collateralized so I don't really see what's complicated.
That's a pretty serious offense and it's extremely uncommon over here.
Sure, repossession can be costly but debt collection agencies will make your life hell very quickly, it's not something you can drag for years without big consequences.