On The Improvement Of The Mortgage System Construction In Progress

Generally speaking, security interest is the best debt security system that is usefulfor social financing and for capital utilization improvements. The first clause ofPRC's "Security Law" identifies that "this law is constructed to smooth financialinstruments and products liquidation, to ensure debt rights realization, and to developsocialism market economy". Debt security is responsible for capital financing andliquidation. Mortgage rights occupy an important position within security interestsystem with strong economic feature, which not only ensure safety of trade, but alsoutilize goods value. Under-construction project mortgage is a further development oftraditional mortgage method, and also a result of commodity economy development.Under-construction project mortgage is widely adopted due to its capability of capitalliquidation and financing acceleration, and capability of meeting banks' needs ofincreasing loans and developers' needs of fund enlargement. However, since the realestate mortgage system of our country is not completed and well constructed,under-construction project mortgage is merely a very new product that sometheoretical and practical aspects still need to be modified and improved. This essayaims at discussion of some law problems of under-construction project mortgage.This essay firstly summarizes general development rule of mortgage rights basedon research upon domestic and international mortgage rights development history, andcarries out preliminary discussion about the theoretical foundation ofunder-construction mortgage. Secondly, the concept of under-construction project isidentified and features of this method comparing to traditional mortgage methods areanalyzed. Thirdly, this essay analyses settings and legal efficiency ofunder-construction project mortgage rights, and analyses condition limitations uponcontract parties. More importantly, the essay carefully analyses evaluation structure ofthe subject project of under-construction project mortgage based on discussion of landuse right value structure and construction value structure. The essay then indicates thespecial features that possessed by under-construction project mortgage withcomparing to ordinary real estate mortgage. Fourthly, the essay discloses currentunder-construction project mortgage registration deficiencies based on scholarsdepiction about this field, suggests legal ways for current situation improvement andhoping our country could issue new laws for further development. Finally, the essayconcludes the problems that can easily occur within under-construction projectmortgage practice and provides feasible solutions based on the above foundations.