Research On Operation Of Reverse Mortgages Offered By Commercial Banks In China

As the aging of population is deepening in China, and“Pension Crisis” have beendeveloping for several years, we need innovative ways of pension heavily. Reverse mortgageshave been proved feasible to mitigate the pension crisis in some developed country. Thispaper discussed the operation of reverse mortgages offered by commercial banks in China.This paper analysis the reasons for the failure of the pilots in China first. And then basedon the business case of the U.S. reverse mortgage, introduced and analyzed the developmentprocess and product structure and operational process and operating mode of the U.S. reversemortgage. By comparing the present situation of reverse mortgage in China with the U.S.reverse mortgage, the writer imaged how the commercial banks in China operate reversemortgages. But considering about the unique condition of our country, we also will face somelimiting factors when the commercial banks in China offer reverse mortgages. In this paper,the writer give some limiting factors and try to explain them and give some advices.This paper have got the following two conclusions by studying: the first, our country andthe United States have similar market conditions, and we can select the commercial banks asthe main business operations just like U.S. did; the second, the range of products wouldexpand as the business gradually developed. For the initial phase, considering that the marketis indefinite, we need to specify the number of pilot. Along with business’ development,government and insurance companies will enter reverse mortgage market. Also does the assetssecuritization.Reverse mortgage business is a new industry point of integration and developmentopportunities. Expanding the research about it can promote the innovation of the way ofpension largely and improve our pension system further. Blessing us look at the broaderperspective of China’s old-age security problems.