Glossary

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What is eligible loan?

 

Eligible loan refers to loan that meet the criteria from The Hong Kong Mortgage Corporation Limited (HKMC) on Mortgage Insurance Programme (MIP). The Insurance Eligibility Criteria include loan amount, type of property, Loan-to-value (LTV) ratio, property age and loan tenor.

 

What is Parallel Mortgage?

 

Hong Kong Housing Authority Loan Scheme is a kind of Parallel Mortgage. Home owner is applying two mortgage loans separately from government and bank in the  meantime and is both registered as the first mortgagee in The Land Registry. First mortgagee could repay the loan by earnings from property sale if the property is confiscated.

 

What are differences between First Mortgage and Second Mortgage?

 

First Mortgage refers to the mortgage loan that the first mortgagee could get the debts gained by property sale first if the mortgaged property is confiscated on condition of debtors’ late payment. Second Mortgage refers to the additional mortgage of the same property. Security, powers and interest of the second mortgagee rank second to those of the first mortgagee.

 

What is Bank Consent?

 

When the mortgaged property is let, property owner should seek bank's consent. Tenant's right will then be protected in a certain extent if the property is confiscated by bank in terms of the owner's inability of repayment.