Studies On The Risk Prevention Of The Fluctuating Mortgage Loan Of Rural Movables

The fluctuating mortgage is a special mortgage system developed in the judicial practice by the court of chancery in England, which takes a flexible guarantee way without the possession of collateral, sets the guarantee with the current and future assets of the mortgagor and during the mortgage period, and the mortgagor can continue the production and operation activities with his own assets and can dispose of the collateral assets in the daily operation without the consent of the creditors. The legal system for the fluctuating mortgage not only exit in Anglo American legal system of England and the United States, but also exit in the countries with the Continental legal system. The Property Law of the People's Republic China promulgated on March 16,2007 introduced the fluctuating mortgage system, in which Article 181 provides that with the written consent of the parties involved, enterprises, privately or individually-owned business and agricultural production operators can mortgage the current or future production equipment, raw materials, semi-finished products and products, and in case that the obligor fails to pay due debts or realize the mortgage right stipulated by the parties involved, the creditor enjoys priority in compensation in the realization of the mortgage right.The rural finance is an important part of China's financial reform and development, but also has been the weak link in China's financial services. The basic contradiction in the rural finance at present is the contradiction between financial supply and demand, and the existing rural financial system is hard to offer sufficient and effective financial services to farmers,while an important reason for the difficult rural financing is the lack of effective collateral in the rural market. The design of the previous guarantee system in China preferred the immovable mortgage while the movable guarantee system is relatively weak. China's vast rural economy itself is relatively weak in strength and lacks the immovables which can be guaranteed, and the existing land contract management right, homestead, housing and other real estate guarantees are limited, so an important direction of the innovation on rural collateral is the relatively rich movable resource in the rural economy. Upon the promulgation and implementation, the Property law of the People's Republic of China expanded the scope of movable collateral, in which Article 181 provides that "production equipment, raw materials, semi-finished products, products can be secured", which provides a legal environment for the movable mortgage, expanded new ideas to the solution to the financing difficulties in the rural areas. The Study on risk prevention of fluctuating mortgage loans of the rural movables has some significance to further improve our country's guarantee law system, prevent bank credit risks and stabilize economy development of the rural market.This paper takes the Property law of the People's Republic of China as the lead, introduces the source and development of the fluctuating mortgage system, analyzes the advantages and shortcomings of the legal system for the fluctuating mortgage in China and probes into the risk prevention measures to be adopted by the banks engaged in the fluctuating mortgage loan business of the rural movables, hoping to achieve the purpose of further improving the legal system for the fluctuating mortgage in China, promoting the construction of control system of legal risks of the banks and finally achieving the win-win of the banks and the rural producers and operators.