If you need to apply for a mortgage, while you have extra funds and would like to earn for a better interest rate, you can consider applying for the mortgage plan with a deposit-linked mortgage feature to enjoy a preferential interest rate.
Advantages of deposit-linked mortgage
When adopting a deposit-linked mortgage plan, the borrower can enjoy a preferential interest rate which is the same as the mortgage interest rate for savings deposit balance up to 50% of the outstanding principal loan amount.
For example, if the outstanding loan is $4,000,000, his saving deposit amount with high interest rate can be up to $2,000,000. The interests are accrued on a daily basis and the cash can be withdrawn at any time so that they can manage their wealth easily.
Some banks can offer more than one saving account for the high interest rate, his family members can also enjoy the high interest privileges.
Example of receiving higher interests
David applied for a mortgage with a loan amount of $3,000,000, loan tenor of 25 years and interest rate of 2.15%. He has a monthly savings of $5,000 and wants to put it in a savings account.
If the interest rate of a general savings account is only 0.01%, the total return is only $1,883. As the mortgage expense is $880,514, the net interest expense is $878,631. However, if he uses a deposit-linked mortgage plan, the total savings return will be up to $232,473 and the net interest expense is only $648,041. More interest expenses can be saved in this way.
Features of deposit-linked mortgage plan
Deposit-linked mortgage features can be found in HIBOR mortgage plan, Prime-rated mortgage plan or fixed rate mortgage plan, with high cash rebate and attractive interest rate.
The minimum loan amount is normally over $4,000,000. Apart from the HKD mortgage-linked loan scheme, some banks can offer RMB/HKD mortgage-linked loan scheme.
Deposit-linked mortgage plans can be applied for most of the residential properties, including first-hand and second-hand private residential properties, Subsidized Home Ownership Pilot Scheme and White Form Secondary Market Scheme. However, this feature cannot be adopted in the mortgage of industrial, commercial properties and carparks.
The deposit under deposit-linked mortgage is qualified for protection under the Deposit Protection Scheme up to a limit of $500,000 per depositor. Deposit-linked mortgage feature has no arrangement fee and annual fee so that you do not need to worry about any additional charge.
How to apply for a deposit-linked mortgage?
Not all mortgage plans have deposit-linked mortgage features. You may visit our mReferral mortgage comparison page to choose a plan with the best offer. You may also consult our mReferral sales team directly for more information.
If you want to learn more information about mortgage or need help from our mReferral mortgage team, please feel free to reach us at 3196-6688.
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