Seven Hong Kong banks joined the Mortgage Corporation’s Reverse Mortgage Programme to help provide elderly with additional financial planning option.
These are Wing Lung Bank, the Bank of China Hong Kong, Nanyang Commercial Bank and the Bank of East Asia, who will start receiving applications for the programme product immediaqtely; and the Bank of Communications Hong Kong Branch, the Standard Chartered Bank Hong Kong and Wing Hang Bank, who will be introducing the product soon.
The interest rate to be charged by banks on the loans will be the Hong Kong Prime Rate minus 2.5% per annum.
“According to the projections of the Census & Statistics Department, the elderly dependency ratio in Hong Kong, that is the number of persons aged 65 or above relative to the number of persons aged between 15 and 64, will drop significantly from 1:5.6 to 1:2 in 30 years, according to Monetary Authority Chief Executive and Mortgage Corporation Deputy Chairman Norman Chan
“This demonstrates the importance of the need for the elderly to do financial planning. The Mortgage Corporation will work with the banks and elderly agencies to publicise the scheme and inform the elderly of this new choice. For those who wish to make use of reverse mortgage, they should consult a registered counsellor to understand the details of their rights and obligations,” he added.
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