| |
The MIP serves as a useful tool in assisting potential homebuyers to overcome the hurdle of coming up with a substantial down payment for the purchase of a property. From the banking industry perspective, the programme allows the banks to engage in higher LTV lending without incurring additional credit risk and jeopardising the stability of the banking system. In all, it creates a win-win situation for both homebuyers and banks. For year 2008 as a whole, the Corporation received a total of 21,477 applications with an aggregate mortgage loan amount of HK$50 billion. About 93% of MIP loans received are for secondary market properties, demonstrating that the MIP is particularly instrumental in promoting the liquidity of the secondary market. The volume of loans drawn down in 2008 amounted to HK$20.4 billion and the market penetration rate stood at 16%.
The Corporation has taken the following major steps in 2008 to further enhance the product features and public acceptance of the MIP:
|
|
In late 2008, a gap emerged in the local mortgage market as some banks were unwilling to lend above a LTV ratio of 60% for some homebuyers. In response to the market demand for the availability of high LTV mortgage financing, the Corporation launched an enhancement of the MIP in December 2008 to specifically cater for that financing gap. Under this enhancement, mortgage insurance is offered at above the LTV ratio of 60%, subject to a maximum LTV ratio of 90% and a maximum loan amount of HK$6 million. It provides banks with a greater degree of flexibility in conducting their mortgage business and thereby helps to lessen the impact of a credit crunch in the mortgage financing to potential homebuyers.
|