Mortgages
Many Chinese banks offer mortgages to foreign homeowners. Foreigners can borrow up to 70% of the value of a recently built property and around 50% of an older property. Requirements and regulations differ from bank to bank, but most need to see proof of income as well as all visa and passport documentation. The majority of banks only offer adjustable rate mortgages so interest rates may change as the Central Bank adjusts the yuan. In 2007 the Chinese yuan interest rate hovered around the 5.5% mark. Everbright Bank remains the only one in the city to offer fixed-rate mortgages, although other banks say they’re moving to do the same. Do some comparison shopping – a few Chinese banks have unfavourable early repayment policies or overly complicated application processes. HSBC and Standard Chartered offer a US or Hong Kong dollar mortgage (a great way to take advantage of the appreciating dollar to the yuan). Also, be wary of owners or developers who force you to use a certain mortgage provider – this often means they have some sort of kickback deal with the bank.