The initial rate is fixed at 1.28% for the first year, or 1.18% if the property is more than $3million.
Captain Underpants you are correct. The current prime rate is 5% variable. The rate charged for the rest of the loan is the prime rate P, minus 2.7%.
So at the moment it would be 5%-2.7%=2.3%
The bank will only loan you the money over a time period determined by a formula:
50-(Age of the building)=Maximum repayment period.
Eg 30 year old building, maximum repayment period 20 years.
35 year old bldg, 15 yrs.
I believe it used to be 40-age but has been increased.
The bank can only lend you 70% of the property Value. You can borrow an additional 20% to take the total up to 90%. However you must pay a premium to the Hong Kong Mortgage Corporation (a goverment agency) to cover the additional 20%. This varies with the tenure of the loan and the pecentage above 70% you want to borrow.
There is more to this but I think I should get a 2nd job as a mortgage advisor first....
