We have often been reminded in the past that the mortgage plan provided by the developer is a "double-edged sword". If you make good use of the low-interest period in the first 2 to 3 years, you can save interest. At the same time, for people who are self-employed or have irregular incomes and do not necessarily have proof of income, they can get 2 years to sort out their income information and catch up with developers. The mortgage will be transferred back to the bank for mortgage before the interest rate reaches high. However, if "procrastination" breaks out and you still delay planning to switch back to a bank mortgage after entering a period of high interest rates, you may be in a dilemma.
Solution: Switch back to a bank mortgage to lower payments
Recently, we received a case of this kind. A client purchased a unit for NT$27 million 5 years ago. Since the client already had a mortgage at the time, the bank could only apply for a 40% mortgage. So he switched to the mortgage plan provided by the developer. After receiving the 60% mortgage, the customer believed that the developer's mortgage was interest-free for the first three years to 1%. Even if the interest rate rose to P in the fourth year, that is, it had risen to more than 5%, he still believed that it was "based on the average of several years." The interest rate was not too high, so I did not process the remortgage immediately. Unexpectedly, when the mortgage entered the fifth year, the financial institution that provided the developer with the mortgage told the customer that due to the latest decline in the valuation of the customer's property, the customer was required to pay approximately 2 million. Yuan difference, or if the mortgage interest is increased to 10%, the mortgage will continue to be provided.
Practical Case Study: Dealing with Valuation Decline and Renewal Issues
The customer checked the online bank valuation by himself and found that the unit valuation had indeed dropped by about 15% compared with the purchase price. He was extremely hesitant and asked us for help. After understanding, we found that the unit held by the customer is a "special account", and the valuation gap between different banks will be larger than that of ordinary units. With our efforts, we helped the customer find a bank whose valuation is approximately 10% higher than the customer's purchase price. At the same time, the customer benefited from the Hong Kong Monetary Authority's mortgage relaxation measures in July. Even if he has other mortgages, the maximum mortgage ratio he can apply for has increased from 40% before the relaxation to 50%. The customer has made payments for nearly 5 years, so the remaining loan amount is close to the original purchase price of 50%. Therefore, the customer does not need to make up any down payment and can seamlessly transfer it back to the bank for mortgage. The interest rate is 3.725%, which is higher than the original interest rate. The interest rate has risen to the prime rate (P) 5.875%, and the monthly payment has been reduced by more than 20,000 yuan (24%).
Early preparation and assistance from a professional mortgage agent
In fact, it is not just the above-mentioned cases. The property market has performed poorly in recent years. Owners of new properties purchased in the past five years may experience a similar drop in valuation if they originally chose a developer's mortgage. They have to make up the difference before they can transfer back to the bank mortgage, which makes them Many property owners are "cheating to live with high interest rates." For example, an owner of a new project purchased a new project for NT$6.78 million three years ago, and the latest valuation was NT$5.5 million. The difference is nearly 19%. The owner made a mortgage with the 85% developer back then. Now it has entered a period of high interest rates, and interest rates have risen. to the level of P, but since the outstanding loan amount is more than the latest valuation of the property, unless the owner has the funds to make up the down payment of 20%, it is basically impossible to transfer it back to the bank for mortgage. There is also a case where the finance company will no longer renew the mortgage after 3 years. We have to find another finance company for the client to make a short-term loan. Although the interest rate is high, it at least buys the client time to sell the property to reduce losses.
The above example reminds everyone that if you want to choose a developer's mortgage, you need to make early preparations for the subsequent remortgage plan back to the bank, or find a professional mortgage agent to assist you early, or you can find a suitable solution or transition plan early to reduce the risk of loss.