Seven banks have joined the Mortgage Corporation’s Reverse Mortgage Programme which provides elderly people with an additional financial planning option to enhance their quality of life.
The banks participated in the signing ceremony today as the first batch of pilot banks intending to offer reverse mortgage loans. Among them, Wing Lung Bank, the Bank of China (Hong Kong), Nanyang Commercial Bank and the Bank of East Asia will start receiving applications for the programme product from today.
The Bank of Communications Hong Kong Branch, the Standard Chartered Bank (Hong Kong) and Wing Hang Bank 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.
Speaking at the signing ceremony, Monetary Authority Chief Executive and Mortgage Corporation Deputy Chairman Norman Chan said: “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.
“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.”
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