Banks woo real estate agents to boost mortgage business

PUBLISHED : Wednesday, 28 April, 1999, 12:00am
UPDATED : Wednesday, 28 April, 1999, 12:00am

Midland Realty is linking up with various banks which provide home mortgages at preferential terms in a bid to enhance its competitiveness.

Company spokesman Magdalene Tang Wing-sze said banks were becoming more aggressive in approaching estate agents to refer home buyers seeking mortgages.

The agency has aligned itself with several banks, including Standard Chartered, Citibank, Dao Heng, Overseas Trust Bank and American Express.

'Sweeteners' such as waiving legal fees and providing attractive mortgage terms were being offered, she said.

Ms Tang said Midland did not charge a referral commission from banks.

Customers were free to select their banks to obtain a mortgage.

Midland, which has 138 branches, struck 2,900 deals last month.

Most home buyers were concerned about banks' lending attitudes as they had to calculate whether they could afford to pay the monthly mortgage instalment before making purchases, she said.

Ms Tang said the company had formed a 'Midland Club' last year which enabled members to enjoy special discounts at various decoration firms and retail outlets. The club currently had 3,000 members.

Midland is also planning to place all the properties it has secured the right to sell in the second-hand market on the Internet in June or July.

'We will update the transacted prices every 72 hours to provide the latest information to potential home buyers,' Ms Tang said.

Meanwhile, a joint venture formed by Centaline Property Agency and Sun Hung Kai Properties (SHKP) is providing a mortgage-broking service.

The joint venture, Centaline- Hung Kai Mortgage Broker, is negotiating with two banks and a financial institution to expand its services.

Alex Tang, who heads the mortgage-broking venture and is an associate director of Centaline Property Agency, ex pected Centaline-Hung Kai to sign the deal soon. Centaline-Hung Kai had referred about 200 customers to its clients within one month but Mr Tang said this was a small percentage compared with the almost 2,200 deals it handled last month.

The number of referrals would increase once the joint venture signed up more banks, he said.

Although the service would be free to second-hand property buyers, Centaline-Hung Kai would charge banks a commission equivalent to 0.5 per cent to one per cent of the successful applicant's loan amount.

Mr Tang said banks could reduce their overhead costs in looking for mortgage business by using the brokerage service.