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SCMP Reporter

IN the hotly contested race to grab a slice of the lucrative mortgage market, Hang Seng Bank has launched two new mortgage loans, giving flat-owners easy access to cheaper, short-term funds.

  Similar to the loans launched earlier by Chase Manhattan Bank, the two loans offered by Hang Seng, the Home-for-home bridging loan and the Flexi-redraw mortgage loan, are the latest relaxation in the bank's once-tight mortgage policy.

    Hang Seng has announced a series of measures to stimulate the market's appetite for mortgage loans since March.

  The bank has been aggressively expanding its loan book by loosening the loan-to-valuation ratio for luxury flats to 70 per cent, lowering the mortgage rate on such flats, extending the repayment period to 25 years and providing more loans to Home Ownership Scheme participants.

  The Home-for-home bridging loan, ranging from $100,000 to $1.5 million, is a six-month loan designed for homeowners who wish to purchase another property for self-use.

  The loan amount and the outstanding mortgage loan should not exceed 70 per cent of the appraised property value.

  Hang Seng would pay the legal fees for the mortgage deed of the existing property.

  The Flexi-redraw mortgage loan is a revolving loan provided for professionals and senior civil servants to take advantage of the appreciation of their residential properties and get extra cash.

  Similar to mortgage refinancing, customers can apply for an increase of the loan amount up to 70 per cent of the adjusted valuation of a property.

  While the loan can be repaid and redrawn in full or at any time, the interest charged is the standard mortgage rate.

  Deputy general manager Mok Wai-kin said: 'There are lots of new features in these loans which are different from other banks and which customers will find attractive.'     Borrowers were only required to pay monthly interest on the two loans.



Hang Seng Bank joins mortgage market race