Which Bank gives the best Mortgages

[skippy777]

I am looking into buying property in Hong Kong, which Bank gives the best deals?

[hughorgen]

If you are seriously considering buying in Hong Kong then you are seriously misinformed !!!

You need your financial acumen enhanced. Try someone who can read the Property section of the Post and ignore the crud coming from the developers and you may see the signs of doom ....

The only way is doowwwwwwnnnnnnn.
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:eek:

[Squiddley]

Skippy

I don't believe there is a "best"bank, but it definitely pays to shop around. You have to go in person to speak/negotiate with someone at a bank. Without exception, all deals are negotiable, so don't take any advertised offers as the bottom line. It depends lots on the % of mortgage, downpayment sum and of course, your income/job. The location/age/resaleability of the property will also be considered.

Be wary of any charges for "property survey", which although are often waived, are not what they seem. Our place was surveyed, and the report only covered the outside of the block (!) and general development info. Nothing whatsoever about the inside, which is essential.

Just prior to the "crash", we bought and got locked into a 2yr contract with Standard Chartered on a 50% mortgage. The worst thing is that despite the market plummeting, they wouldn't budge an inch on the rate. We're now with Bank of China since Oct 2001 at prime rate minus 2.4%. I sort of expected more from HSBC, but their rates were the highest of the banks we tried. Good looking offers came from Dah Sing bank, Wing Lung bank, BoC and Bank of America.

If you're eligible, you might consider the G'ment home ownership loan scheme (up to HKD600K for a married couple or HKD300K for a singleton.) Not sure if it still open, but at the time, they were offering a fixed rate of 3.5%, which was then prime minus 6.something. A bargain, especially when it comes to dual mortgaging.

Hope this is of some use, and feel free to mail/post if you need any more details.

Happy hunting!

[skippy777]

Thank's for the help Squiddley I'll definately shop around and bargain hard.

[Albatross]

Hey Squid, how long is the fixed part fixed for. A few have told me that the prime rate is fixed but the minus part can come and go.

[Squiddley]

Albatross

The "fixed" rate I referred to is that from the HKG Housing Society, for their $600K loan. That interest rate is permanently 3.5%pa for the full term of 10 years, irrespective of what happens in the market.

The other "fixed" or rather "prime" rate is fixed by a committee of the big banks (I forget the actual name) and approved/monitored by the HKG Monetary Authority (HKMA). HOWEVER, it's only fixed untili they decide to adjust it :) Any minuses to prime rate will reflect the market in general, and are at the total discretion of the bank you deal with.

Basically, banks can only charge interest as high as prime rate, but they use deductions as marketing tools. The minus percentage will also be subject to review, usually in periods of 1-3 years. Another thing I should add is that some banks will offer a greater percentage deduction if you sign a longer fixed-term contract.

Hope this helps. Feel free to post/email of you need more info.
Sq

[Plastique]

Hey Skippy,
HSBC are doing P -2.5%, Standard Chartered are doing P-2.6%, for the life of the mortgage (up to 30years).
P (Prime) is 5.125% at the moment.
The Standard Chartered one has a 3 year redemption period and the fees for partial prepayment are higher than HSBC.

If you want a "flexible" Aussie style current account mortgage, Standard Chartered are doing one at P-2.25%. As this facility will cost 0.25 - 0.30% more that your best traditional mortgage, you will have to be running a fair bit through your account to make that pay. It is a nice place to keep your tax money though as you effectively earn as the account balance will come off your mortgage.