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Hong Kong to Launch Mortgage Income Pilot Scheme for Elderly By Frederik Balfour, Bloomberg
December 16, 2010
Hong Kong
The Hong Kong Mortgage Corp plans to launch a pilot program next year that allows the city’s elderly to receive an income from the value of their homes, the authority said in a government press release today. The so-called reverse mortgage scheme will allow owners of non-mortgaged homes to receive monthly payments until their deaths using their property as collateral. At that time, the lender would repossess and sell the property to recover its costs with any surplus going to any heirs, the statement said. The press release did not say which banks would be participating in the scheme. The authority decided to launch the program after interviewing 1,005 homeowners aged 60 and above whose properties were mortgage-free or nearly mortgage-free, the release said. The
Hong Kong Mortgage Corporation will introduce a novel reverse mortgage
pilot scheme next year, to give elderly property owners another potential
source of income. Under the scheme, people aged over 60 who own their own
flats can take out a reverse mortgage loan with an approved bank, and
receive monthly payments for the rest of their lives.
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