With the acceleration of urbanization, the real estate industry has sprung up rapidly, with the growth, housing finance pooping up soon afterwards, and housing finance system has getting stronger. The most common one in the housing finance system is mortgage loan. The current housing financial system in the United States was developed after the Great Depression. In 2001, its housing ownership rate is 67 8%, which is 70% higher compared with the number four years back, and that is inseparable from the support of the financial system.The current housing financial system of the United States consists of a primary market and the secondary market. The former one focuses on activities that provide financing to house buyers; while the later one is a variety of activities to sell mortgage related assets.
The American housing financial system has exert positive effects on commercial financial institutions, meanwhile, it’s embodies strong government will. The current operating model of the US housing financial system. Residential households, mortgage lenders, government backed enterprises, investors, insurance and guarantee agencies are the five main actors in the US housing financial system. The Federal Housing Finance Committee and the Federal Housing Enterprise Supervision Office are the main body of government supervision in the housing financial market.
The principal part of the housing financial market including the mortgage borrower, mortgage lenders, and the primary market insurance institutions. The contract is signed between the buyers with savings and loan association, commercial banks, mutual assistant banks and other financial institutions. Financial institutions will afterwards release housing mortgage loans, buyers will then pay the debt with interests following the agreed schedule. The federal law had make the rule that when the value of a housing to loan is more than 90%, the borrower must purchase mortgage insurance (actually, it is always done when the loan value is higher than 80%). The Federal Housing Authority, the Veterans Administration provides housing mortgage insurance for eligible families, and the private insurers provide relevant commercial insurance services. Housing mortgage loans are divided into the Federal Housing Authority or Veterans Administration mortgages and ordinary mortgages based on whether there is a Federal Housing Authority or Veterans Administration insurance.
The secondary market of housing finance includes secondary market guarantee institution, Government supported enterprise and loan release institution. The operation is all about the securitization of housing mortgage loan, it helps for reduce the risk for housing mortgage loan release risk and rick for the market, meanwhile improved the housing mortgage marketing. Provide a security mortgage loan process.
In order to promote the smooth operation of the housing financial market and the realization of the public housing policy, the U.S. government has set up the Federal Housing Finance Committee and the Federal Housing Enterprise Supervision Office, respectively, which are responsible for the supervision of the primary market and the two market. Because the primary market mortgage lending institutions, it is difficult to implement the direct supervision, so the U.S. government divided the country into 12 area, established 12 Federal Home Loan Bank (as a member of the organization of federal loan bank system), the 12 Federal Home Loan Bank attracted a total of 8104 home mortgage lenders as a member of the Federal Housing Finance Committee through the direct supervision of the 12 Federal Home loan banks, indirectly to achieve a level of market supervision. In the two market, the Federal Housing Enterprise regulatory office oversees the National Mortgage Association and the Federal Home Loan Mortage Corporation. In particular, the Federal Housing Finance Committee and the office of Federal Housing Enterprise Supervision and monetary Administration (Office of the Comptroller of the Currency), Administration (Office of Thrift Supervision savings institutions), the Federal Reserve System Management Committee (Board of Governors of the Federal Reserve System) are jointly called the American financial system five regulatory bodies.