Highlights

30% discount on mortgage loans exists nominally

By Ren Jie (chinadaily.com.cn)
Updated: 2010-02-23 16:39

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30% discount on mortgage loans exists nominally

Some major joint-stock banks in China began to tighten lending to first-time home buyers after the Spring Festival holidays, following Bank of China and China Everbright Bank cancelling 30-percent discounts on interest rates.

As few clients were eligible for favorable terms of mortgage loans, which included that applicants must be first-time home buyers and live in the houses themselves, the 30-percent discount on the interest rate actually existed in name only. Meanwhile, some commercial banks also have instructed their local branches to control mortgage loans before the Spring Festival.

China's joint-stock banks and city commercial banks usually provide more favorable discounts on mortgage loans than State-owned banks in order to attract clients. However, as banks' house loans increased sharply last years, most banks began to control mortgage loans though flexible policy adjustments, including raising or cancelling discounts and slowing down the activity of issuing mortgage loans...

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