The Operational Mechanism Of Financial Institutions In HECM Program

The limited ability to provide social security service brings potential problems to China in the aging society. In this article, I try to introduce the process of home equity converse mortgage (HECM) in order to improve the level of social security and to release the fiscal burden of government.Firstly, I give an introduction of the whole operational process of HECM , and then focus on the necessity and availability in China, following the operational mechanism of the financial institutions. Secondly, I emphasize on the risks and the solutions accordingly. After that I bring forward the whole operational process held in China in terms of credit division. In conclusion, I provide some underlying problems that we must face with and some suggestions.