Choose a mortgage that suits your financial planning needs
If owning a house is a dream come true, selecting the most appropriate mortgage can be a downright nightmare - especially for the first-time buyer.
According to guidelines from the Hong Kong Monetary Authority, banks cannot provide mortgages of more than 70 per cent of a property's estimated value. The Hong Kong Mortgage Association will provide an additional mortgage, bringing the total amount up to as much as 95 per cent.
Most banks obtain insurance from the Hong Kong Mortgage Corporation. A few, such as Standard Chartered, have launched an alternative approach, relying instead on independent insurance providers.
'Mortgages themselves are a financial planning tool, not simply a property investment tool,' says Susanna Liew, general manager, mortgages and auto, at Standard Chartered.
'Both cash-flow requirements and net interest payments should be taken into consideration.'
The first step is to look at the actual interest payments and not the rate of interest charged.