Apart from the housing reverse mortgage insurance offered by insurers, you should avoid all other “housing-for-pension” schemes — never mortgage your home to buy financial products

Cost: There’s no cost involved. Keep your property deed in your own hands and don’t hand it over to anyone promoting “housing-for-pension” schemes. Before signing any mortgage, guarantee, or loan agreements, show them to your children first. The difficulty lies in the fact that promoters often come repeatedly and appear very enthusiastic, leaving seniors feeling awkward about refusing them.

In plain terms: The only legitimate “housing-for-pension” option is the housing reverse mortgage insurance provided by insurers, which is currently still in the pilot phase and used by very few people. Door‑to‑door sales pitches have nothing to do with this official program. Scammers trick seniors into mortgaging their homes so they can use the borrowed money to buy financial products recommended by the fraudsters — essentially a “pay‑old‑debts‑with‑new‑money” Ponzi scheme. Regulators report cases where seniors were unaware their homes had been mortgaged; as a result they ended up losing their property while still owing a loan.

Benefit: The China Banking and Insurance Regulatory Commission’s Consumer Protection Bureau clearly distinguishes between the genuine and the fraudulent schemes. The legitimate program is called “Housing Reverse Mortgage Insurance for Seniors.” Eligible seniors who fully own their homes may mortgage them to an insurer while continuing to live there, rent it out, or otherwise use it. Any sale or disposal of the property requires consent from the mortgagee — the insurer. Seniors then receive a pension according to agreed terms until their death. This service remains a pilot project with limited participants. Illegal operators label their schemes “housing‑for‑pension,” but they bear no relation to the official program; they merely exploit national policy to promote illegal fundraising. Their modus operandi is to persuade seniors to mortgage their homes and then use the proceeds to purchase recommended financial products — often a classic Ponzi arrangement. The original warning states that some participants are completely unaware their homes have been mortgaged, ultimately resulting in loss of the property and outstanding debt. A useful guideline for evaluating returns is also provided: if a financial product promises a yield above 6 %, it should be viewed with suspicion; above 8 % it becomes highly risky; and anything over 10 % means you should expect to lose all principal — “high returns with guaranteed principal” is a hallmark of financial fraud. The same warning also stresses the need to be cautious when signing contracts and never to sign blank documents (National level, June 2021).

Evidence grade: B

Sources:中国银保监会消费者权益保护局 (2021). 关于警惕「投资养老」「以房养老」金融诈骗的风险提示（2021 年第三期）. https://dfjrjgj.hunan.gov.cn/dfjrjgj/yhlj/202106/t20210608_19450856.html（湖南省地方金融监督管理局转载）；民政部、中国银保监会 (2021). 关于养老领域非法集资的风险提示（第四种表现形式：以宣称「以房养老」为名非法集资）. https://www.mca.gov.cn/n152/n164/c36171/content.html

Notes: This grade B reflects that the statements derive from regulatory risk warnings and expert judgment rather than empirical research data. The 6 %, 8 %, and 10 % thresholds are reference points suggested by regulators for consumers, not legally mandated standards. The former CBIRC has been merged into the National Financial Regulatory Administration; the original announcement page is no longer accessible, so we cite a reposted version from a provincial financial regulator. The core issue here is not merely possible losses on financial investments, but that after mortgaging their homes seniors still carry a loan obligation — a loss far exceeding any potential principal loss. General rules concerning contract signing and blank documents are covered in Section 8, Item 17; steps to halt fraudulent transactions after being scammed are outlined in Section 8, Item 2.