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Exploring the 'Two-Rights-and-One-Housing' mortgage loans, broadening farmer access to financing (No 180, 2014)


Research team on Studies of Rural Land Financing System and Patterns, by Cheng Yu and Wang Bin, Research Department of Rural Economy, Development Research Center of the State Council (DRC)

Research Report No 180, 2014 (Total No 4679)


Allowing farmers to mortgage the land contracted management rights, the stock rights of collective assets and their rural housing is not only an important part of the rural collective property rights reform but an effective way to ameliorate farmer difficulties in getting loans. On the basis of the reform of rural collective property rights, Ningbo City, Zhejiang Province, has launched a pilot program to allow farmers to get loans by mortgaging the "two rights and one housing". Efforts have been made to improve the market circulation of property rights mechanism and establish a multi-layer risk protection system to make sure that the land contracted management rights, the stock rights of collective assets and farmer's rural housing can become effective collateral in the market, and to satisfy the borrowing needs of farmers through credit in an effective manner. However, given the system and market circumstances are immature at the moment, the popularization of the "two-rights-and-one-housing" mortgage loans still faces practical system barriers. Urgently needed are efforts to push forward the rural property right confirmation, provide legal protection of rural assets' hypothec, ensure the realization of the hypothec's market value, protect market bottom line, and keep the risks in agricultural insurance and credit insurance under control.