It is generally legal for developers to mortgage land. According to the provisions of the Civil Code, the mortgaged real estate can be transferred or leased with the consent of the mortgagee, and the secured creditor's rights shall be paid off to the mortgagee in advance with the proceeds, and the part exceeding the amount of creditor's rights shall be owned by the mortgagor.

legal ground

Article 406 of the Civil Code of People's Republic of China (PRC) * * * During the mortgage period, the mortgagor may transfer the mortgaged property. Unless otherwise agreed by the parties, such agreement shall prevail. If the mortgaged property is transferred, the mortgage right will not be affected. Where the mortgagor transfers the mortgaged property, it shall promptly notify the mortgagee. If the mortgagee can prove that the transfer of the mortgaged property may damage the mortgage right, he may require the mortgagor to pay off the debt or deposit the proceeds of the transfer in advance with the mortgagee. The part of the transfer price exceeding the amount of creditor's rights belongs to the mortgagor, and the insufficient part is paid off by the debtor.