The Liquidity Management Of U.S. Housing Mortgage Lenders

Housing is undoubtedly one of the basic needs for the people, and has evolved into one of the greatest concern to the people. In 1990s, our country implemented the commercialization of housing; the liberalization of the market economy has brought China's real estate rapid leaps. The process of housing reform encouraged the supply of housing industry, offered a rich variety of housing products, greatly meeting the people's urgent housing needs.But, no doubt, because of failure to recognize the special nature of housing, the introduction of market elements in the housing industry also brought the issue of excessive liberalization. Housing is the people's necessities of life; even the lowest income groups also need housing services. It is related to civil rights, so has the dual nature of consumption and investment. Because of failure to recognize the special nature of housing, the government neglects their responsibilities. Now the housing prices continued to rise, and there is increasing pressure for the low-income families to purchase houses, however the government helps them little. Currently, in sharp contrast to the triumph of the real estate industry, the issues of buying house for low-income people are also increasingly prominent. In recent years, the "housing problem" has become the focus of the community; the situation has seriously hampered the healthy development of economy and society, and even affects social stability.This article is intended to draw the experiences of U.S. mortgage lending institutions liquidity management, and how the United States provide financing to low-income families by mortgage lenders, through a focused analysis of the Federal Home Loan Bank (FHLB) mode of operation and liquidity rules, the paper summarizes useful experience for the development of housing mortgage loan in our country. Lastly, combined with China's specific national conditions, this article proposed to establish and improve mortgage lenders in China.This article includes six chapters:The first is the preamble, which outlines the background, significance, research methodology, literature review, and important innovation of the study. The second chapter focuses on the overall financing of the U.S. mortgage market which includes two-stage markets. Then give an introduction to the important role of the Federal Home Loan Bank housing loans in the financing structure. The third section introduces all aspects of the Federal Home Loan Bank System, reviewed the history of its development, and followed by an overview of its organizational structure, management of members and provision of financing products and services. FHLB are intended to provide liquidity to members, thereby increasing the supply of residential mortgage loans and community investment, and also provides services to community development and housing construction. Finally, the paper will introduce the risk supervision of the banking and capital requirements. The regulator for Federal Home Loan Bank is the Federal Housing Finance Agency, which requires the bank to implement risk-based capital management program.The fourth part of this paper is to have a detailed analysis of the Federal Home Loan Bank's liquidity sources, which include the discount notes, bonds, callable and putt-able bonds, TAP Issue Program, members' capital investments and so on. However, the major financing channels are discount notes and bonds. The fifth chapter is focused on the Federal Home Loan Bank's services and support loans to low-income people and their communities, the experiences are very useful reference to our country.Part VI is the purpose of this paper, which is based on the above analysis of Federal Home Loan Bank's operating mechanism, liquidity management, financial products it provides. The paper summarizes the U.S. mortgage sectors'experiences in providing loans to low-income people. Lastly, the paper gives some recommendations for the financing problems in Mortgage lending institutions.Academic circles at home and abroad those studied the Federal Loan Bank's research mainly focus on the FHLB membership management, the main mechanism of interaction with other market players, its impacts on the mortgage market, but researched much less on its liquidity mobilization and management. They didn't study on liquidity sources of mortgage lenders in the original level market or conducted a detailed study on the U.S. mortgage lending institutions for reference and analysis, especially on how the Government provides financial support for vulnerable groups and low-income families.Therefore, this article will set the focus of the study:first gives an analysis on how the U.S. government provides financing supports to low-income populations in original mortgage market, including a detailed study of the government-sponsored enterprises-the Federal Loan Bank's operations and liquidity management. These studies will be a good reference for China to resolve the current housing issues. This is precisely the innovation of the paper, which has important significance. Through detailed description and analysis of the Federal Home Loan Bank's liquidity management and operation mechanisms, the paper will summarize the experiences of how to manage sources of liquidity and the innovative ways of debts. These experiences will be beneficial to our country on how to give financial assistance to the low-income families and their communities'development, how to establish and improve China's government-sponsored mortgage lending institutions, and to better serve low-income people in housing finance services.