Housing, The Reverse Mortgage System

Because the execution of birth control planning policy and the descend of population birthrate and the extension of the life expectancy, the aging population of our country has intensified. Plus our social security system is not sound and the old pension is not enough and so on, which cause the retired problem of our country increasingly rigorous and has already caused extensive concern. So how to investigate a new path that matches our state of the nation and resolve the above-mentioned rigorous problem actually under the decided condition is really important.The execution of the housing reverse mortgage system is one of ways to confront the aging population in the overseas. It is the outcome that national economic society in overseas develops to the certain stage. This system is the elders with their house for mortgage to commercial bank and insurance company and the organization for public welfare which have government background to loan and subsidizes the old people's living cost and improves the elders living level. When the elders die or move to leave that house permanently, the house's ownership belongs to the above-mentioned organizations. Because its cash flow is the contrary of mortgage, it is called the housing reverse mortgage. The prior condition of its implement is that the residents have their own house. In the meantime, the government takes into an aggressive leading, so the housing reverse mortgage system is mature in the overseas.Under our existing finance system, depending on the society or public finance or traditional mode, all these are not enough to solve the problem. Therefore, developing the housing reverse mortgage system can provide a new kind of strategy that solves the social problem which is brought by the aging population at the social security system and alleviate the situation that the our funds is short currently and improve the elders living level. And our people's economic condition particularly the ownership rate can satisfy developing the system of reverse mortgage. So this paper begins with analyzing the definition of reverse mortgage and it adopts the method of theories research. It analyzes the differentiation of reverse mortgage with the related concept and introduces the circumstances of the system of reverse mortgage in the overseas. It tallies up beneficial experience in the overseas .It proves to be viable according to our economic condition and existing law. At last, it provides some lawmaking suggests.The text is divided into four parts:The first part the brief introduction of the housing reverse mortgage system. Firstly, introduce the content and basic characteristic of the system of reverse mortgage. Then compare reverse mortgage with mortgage and legacy-support agreements and petition of the property. Then introduce the theories foundation of the system of reverse mortgage: life circle hypothesis and patition of the property and property mobility theories. Then point out that the system of reverse mortgage can achieve the favorite allotment of wealth in one's life and satisfy the old people's will of living his house and carry out the performance and the liquidity of the property.The second part the operation practice of the housing reverse mortgage system in the overseas and inspiration. Such as American and English so on, the housing reverse mortgage system is mature, including the product type and the power of the government support. We can draw lessons from these nations. The housing reverse mortgage system is the outcome that the economic society develops to the certain stage. It needs the government supports. And we must enhance the market supervise and control the risk. The government must strengthen publicity and lead correctly and make the citizen's consume idea change.The third part economic research of the housing reverse mortgage system in our country. Firstly, analyse the economic conditions of the housing reverse mortgage system in our country which has been carried out: the process of urbanization has provided a broad market for housing reverse mortgage system, the enhancement of the house privatization rate and the development of the real estate market for the housing reverse mortgage system provide the necessary conditions, the improved living conditions of the elders provided the possibility. Secondly, analyse the financial conditions, or that China's balance of savings deposits of residents increased year after year, the residents of Personal Finance noticeably enhanced their awareness of the introduction of new financial products to better acceptance, China's financial market improved continuously, and financial institutions strong awareness of innovation, financial instruments innovation, and its ability to resist risks, and so are gradually strengthening. These have made housing reverse mortgages as a new financial products, may result in the real estate market, insurance market and the capital market a new model of joint operations. In short, China's housing reverse mortgages in the economic conditions have been met. Thirdly, in view of the reverse mortgage may be in the market risks, overcome by means of reverse mortgage to eliminate housing concerns of the two sides. Finally, from a reverse mortgage system in the corporate social responsibility perspective of the analysis, pointed out that housing reverse mortgages which can be carried out will be involved in corporate social responsibility and profitability goals closely together.The fourth part law research of the Housing reverse mortgage system in our country. This part is the core content of this paper. Even if housing reverse mortgage system there is economic feasibility, but also we need regulating it through legislation, because any system can be adjusted only through legal contingencies and arbitrary from the fetters. Firstly the author analyses the existing laws and draw a conclusion that develops the necessity of the "housing reverse mortgage law". Second on China's "housing Reverse Mortgage Act," the legal ranks was discussed, pointing out that "housing reverse mortgage law" should be in a legal form. Thirdly, the "housing reverse mortgage law," the structure of that "housing reverse mortgage law" should include general principles, housing reverse mortgage and the rights and obligations of the main housing value assessment, the Housing reverse mortgage procedures liability laws, and other parts of the content. Finally, on the " housing reverse mortgage law," the main content of a number of observations and recommendations, including legislative purpose and basis of the concept, the basic principle, the main reverse mortgage, housing reverse mortgages registration, reverse mortgage the rights and obligations of both sides , intermediary institutions, housing insurance, and legal responsibilities.So I believe that the timing and conditions of the reverse mortgage are ripe in our country. We must be aware of reverse mortgages in housing market risks that may exist under the premise of research should be actively carried out as soon as possible to suit China's national conditions. "The housing reverse mortgage Act" can promote the reverse mortgage system smoothly in China.