Legal analysis: Letter of credit mortgage loan means that the exporter receives a letter of credit from abroad. When the exporter purchases the export goods related to the letter of credit or produces the export goods, there is a shortage of funds. Use this letter of credit as collateral to apply for a local or foreign currency working capital loan from the bank to use for the funding gap that occurs during the processing, packaging and transportation of exported goods.

Legal basis: Article 394 of the "People's Republic of China and Civil Code" To guarantee the performance of a debt, the debtor or a third party does not transfer possession of the property and mortgages the property to the creditor If the debtor fails to pay due debts or the circumstances agreed by the parties to realize the mortgage rights occur, the creditor shall have the right to receive priority payment for the property.

The debtor or third party specified in the preceding paragraph is the mortgagor, the creditor is the mortgagee, and the property providing guarantee is the mortgaged property.