- A new rule will allow a bank to pay the mortgage loan secured by a homebuyer directly into the bank account of the seller electronically
- The move aims to protect buyers who find themselves out of pocket when the law firm handling their transaction goes bust
The role of lawyers as middlemen in residential mortgage transactions is to be abolished under new rules designed to protect Hong Kong homebuyers.
The change will allow a bank to pay the mortgage loan secured by a homebuyer directly into the bank account of the seller electronically. The buyer would then use a cashier order to pay the remaining balance to the seller.
The new rule, put forward by the Hong Kong Monetary Authority on Wednesday, is aimed at protecting buyers who find themselves out of pocket when the law firm handling their transaction goes bust or gets into difficulties.
It is expected to take effect in the second half of next year after a consultation followed by a trial period. It will initially cover secondary market transactions before being extended to new flats.
Read more at https://www.scmp.com/business/banking-finance/article/3161443/hong-kong-scrap-middleman-role-law-firms-mortgage
