Posted by
arlina
16 yrs ago
I have read some advises and questions regarding
buying a property in hk, but I want to ask my elementary question to whoever is kind and patient enough to give me answer. First, do I really need cash for dp in order for me to buy a property? Or will some banks provide all the loans for me? And will this depend on where the property is, as well?
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http://www.hsbc.com.hk/1/2/hk/mortgages
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Typically you will need a deposit; your income and net worth will determine the amount a bank will require as a "ratio" of lending to value of the property. Often a bank will give you a "re-decoration" loan to assist the upgrading BUT this is meant to be tied to actual bills paid for redecoration. There is also the possibility of getting a personal loan to assist on funding the purchase HOWEVER.......a bank often requires that YOU have the down payment from your OWN resources. This is effectively part of their credit check on you and your ability to repay the they will give you; if you are 100% financed then you are less likely to pay the money back....this is the basis of the sub-prime fiasco we are yet to see in full.
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Can someone care to enlighten me...
Assuming there's sufficient funding to cover the purchase price, would it be better to pay cash and avoid interest?
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You may apply for a high ratio mortgage through any major bank in HK however it is always your ability to repay the loan that is key. The bank as discussed above may undervalue the property so this key. If you go after 95% loan, 5% down then the bank would need to submit to Hong Kong Real Estate Authorities for review and approval and if yoiu pass this you may be eligible for only upto 20M HKD and have the income to support it.
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