Research On The Innovation Of Reverse Mortgage Product In China

With the coming of aging society, the old people are becoming an important factor to be considered in building socialist harmonious society. Although our country government has done much to solve this aging crisis, there is a lot of difficulties, because of our fundamental realities of the country, such as the developing country, the large population, and the fast aging rate. Talking of providing for the aged from the family, the "4+2+1"family mode is coming under our country basic policy of family planning, and the working generation will be confronted with the burden on supporting both sides parents and nurturing child. So, Reverse Mortgage is the real way for the elders to gain cash without missing the ownership right of the building at present. As one of new financial products of providing for the aged and benefiting in many ways, the basic characteristic of reverse mortgage is combining buying house and providing for the aged.Specifically speaking, the owner mortgages his house for a loan from the same banking institution, and this banking institution evaluates this house, getting the price of the house property, and then getting a residual that subtracts the anticipating value discount from the house property price. This loan of fixed number of years is amortized to the life expectancy of the people who borrows or lends money in actuarial mode of the life insurance, a certain way (monthly or according to the year) to the people who borrows or lends money. Until the old people passes away, whose building is taken back to banking institution that will carry out the business (sell or be run under lease). In this way, the aged could liquidate the fixed asset step by step and also own the house for living.This thesis analyzes the overseas reverse mortgage product, and the experience of developing this product in USA, Canada and Singapore and so on. Then it analyzes the conditions of releasing this in our China. Then it focuses on discussing the organization mode of reverse mortgage in China and the pricing problem. At last, it brings forward the countermeasure of our country to develop this business.In short, reverse mortgage is still a just incoming loan product in China, so carrying out this business broadly requires the market demand analysis, cost analysis, the risk research (building handling) and price fixing (ascertaining the loan interest) by banking institutions. And it needs to combine abroad experience and our country reality especially, and to do research on the business risk and carry out the effective countermeasures on this item. The author believes in, with our country reverse mortgage product debuting, a new finance service business and marketplace will be born in future.