The Theory Of The Independence Of Mortgage

Mortgage, known as “the king of guarantee” in China, is playing an important role inChina’s economic life. Affected by traditional theories of guarantee system, subordination hasalways been regarded as a fundamental attribute of mortgage, only a few scholars support theindependence, negotiability and other properties existing in mortgage. The circulationmethods of mortgage and contents of mortgage registration credibility, realized bysubordination and independence of mortgage, are two distinct modes. We cannot tell whichattribute is the right choice for mortgage, because everything has both advantages anddisadvantages. Currently, most countries have gradually recognized the independence ofmortgage so as to achieve the financing and circulation function of mortgage. In order topromote the accommodation of funds and circulation of commodity, our attitude towardsmortgage has become more and more apparent along with the recognition of other countries.We recognize the independence trend of mortgagee has been an irresistible trend in moderneconomic and social development, but the process is never smooth.This paper describes mortgage and its independence trend, distinctions between theindependence of mortgage and traditional mortgage, and the significance of this independencetrend, and uses the method of comparative analysis to explore legislations regardingindependence of mortgage in Germany, Switzerland, France, Japan and other countries andanalyze advanced experience of foreign countries for the purpose of improving China’slegislation on independence of mortgage on a basis of related references. Subsequently, thepaper investigates the status of the system of the independence of mortgage in China. Itanalyzes the definition of the independence of mortgage in "Property Law" and "GuaranteeLaw", and our current legislation has recognized the independence of mortgage to someextent in the relative independence of recognition of the maximum mortgage, independentundertaking of liabilities to guarantee, recognition of the settlement of mortgage for the futuregeneral mortgage claims, establishment of movable floating charge, counter-guaranteemortgage, elimination of mortgage, and other aspects. There exist three main attitudes of relevant scholars towards the independence of mortgage: the subordination of mortgage is stillaccepted by a majority of scholars; independent mortgage has been advocated by someexperts; explore the unfavorable factors and favorable conditions of the relative independenceof mortgage. Analyze the required foundation of institution for Independent mortgage;recognize the value attribute as the core element of mortgage; the principle of fixed sequenceis the basis of the independence of mortgage; establish an improve stock market, etc., so as toconsider whether the independence of mortgage is suitable for situations of our country.Finally, this paper conducts a rational thinking on the independence of mortgagee in China.On a basis of previous analysis, it concludes the advantages and disadvantages of theapplication of the independent mortgage in China, deeply investigates the subordination ofmortgage provided in "Property Law", and puts forward some suggestions on improvement ofthe independence of mortgagee from the establishment of value attribute and security right ofmortgage; the improvement of the public confidence in our mortgage registration system;improvement of the securitization of mortgage; confirmation of a separate collateralutilization right from mortgage and other aspects. It explicitly points out that theindependence of mortgage has become an underlying trend in the modern mortgage system,but we ought to combine its subordination with independence of mortgage instead of payingtoo much attention to the supreme position of the independence. Thus, it appeals to legislatorsto accept relevant recommendations to improve the existing legal system of mortgage.