The Leagal Research On Mortgage Backed Securitization

Mortgage backed securitization is the act of issuing securities backed by independent mortgage assets as credit foundation and the structural funding arrangement using the future stable cash flow generated from those assets as the source of security payment. It can achieve risk remoteness from the original creditors through the redistribution of risk and revenue using certain transaction techniques, and convert to beneficiary interest or bond basing on the future cash flow of assets pool. By integrating the ideas of standard contract, risk remoteness, security and securities, MBS can transform static residential mortgage into negotiable securities. Firstly, MBS can resolve the loan liquidity problem of commercial banks. Secondly, it can help to lead the long-term fund from capital market into housing market, supporting habitants to buy houses. What' more, it can play a great role in keeping out financial risks, managing macro economy, and stabilizing financial system and society. Therefore, it has been encouraged by many governments and widely recognized around the world. From the perspective of economic law theory, MBS and its legal system are the results of countries' active management and coordination of economy, and also reflect the essence of pursuing social equality and protection of investors. Implementation of MBS cannot be separated from certain entities. According toe international experience, the entity of implementing MBS includes two categories, one is government agency, the other is private agency. For example, US, Hong Kong and other countries or districts provide government sponsored agencies with support in the aspects of setting-up, function, main businesses, and taxation, etc. Such GSEs play an important role in implementing policy intention, supporting middle or low incomers housing demand, redistributing financial risks, and promoting capital market. Compared with private agencies, GSEs can play an incomparable role in establishing real estate finance system and implementing macro economy management. As to China, the entity of MBS can have two choices. One of them is the China Mortgage Corporation wholly owned by China Development Bank, undertaking the function of government financial institution. Under the current legal environment in China, CMC is designed to purchasing mortgage loans originated by commercial banks, and then provide commercial banks with liquidity through MBS issuance, supporting middle-low incomers' housing demand. CMC can issue MBS which is a off balance sheet product through the origination of Special Purpose Trust or accept trust from commercial banks directly. Besides that, CMC can issue on balance sheet product through pledge model. This paper uses the research methods as follows, comparison analysis, legal economics, empirical analysis and law explanation methods, etc. Among the methods mentioned above, this paper focuses on the use of comparison analysis, legal economics, and empirical analysis. What' s more, it reference on the principle and methods of accounting theory to a certain extent. As to the empirical analysis aspect, this paper puts an important attention to the research on MBS in US and Hong Kong, the principles and mechanisms of securitization GSEs there, and the successful experience. Beside that, it does some research on the practice and situation of Canada and Columbia. Beside Preface and Conclusion, this paper includes 6 chapters as follows: Chapter 1 firstly researches on the definition, category, transaction and law principle of MBS. Then, using the fundamental principles of economics law theory, it analyzes the origination and purposes of MBS, solving the theoretic position of some problems in this relation. Further, it defines the concept and scope of securitization GSEs. Chapter 2 analyzes the legal system related with securitization GSEs in US, Hong Kong and other counties and districts. Especially, it researches on the role in MBS, played by government as a special economics law entity. Basing on mentioned above, it puts forward...