Is It Permissible to Authorize Someone Else to Use the Land Use Rights Certificate as Collateral?

Pursuant to the provisions of Clause 1, Article 317 of the Civil Code 2015:

Collateralization of assets is when one party (hereinafter referred to as the mortgagor) uses their property to secure the performance of obligations and does not transfer the property to the other party (hereinafter referred to as the mortgagee).

According to this provision, the essence of the collateralization activity is understood as an individual only being allowed to use assets they own to engage in collateral transactions. For example, your father may use his land use right certificate or the land use right certificate of your household if there is consent from other family members.

In the case where your uncle wants to authorize your father to use your uncle's land use right certificate to mortgage to the bank, it does not comply with the above provisions on collateralization because the collateral does not belong to the ownership of the mortgagor. Therefore, this transaction is not permissible.

Please inform your father about this issue for lawful compliance.

Sincerely!