Research On The Improvement Of Legal Regulation Of Mortgage-Backed Securitization In China

Mortgage-Backed Securitization is a kind of Asset-Backed Securitization. In finance, a mortgage-backed security (MBS) is an asset-backed security whose cash flows are backed by the principal and interest payments of a set of mortgage loans. Liquidity and independence is its main feature. MBS not only helps the banks to solve the problem of insufficient liauidity, but also assists investors to enter the credit market. Meanwhile, the transfer of interest rate risk is another main function of MBS. As the securitization market in China is booming, some problems concerning MBS have become increasingly prominent——the return of investment is not reasonable, lack of subprime loans securitization, lack of liquidity and lack of legal regulations. This article mainly focuses on previously mentioned issues, and looks for solutions to these problems.