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Peter would like to apply for a mortgage. Identify at least FOUR factors that the bank will consider and briefly explain why they are important to his application. You may show your answers using the point format with completed sentences.
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Assume that Peter can get the maximum amount of mortgage permitted under the current regulation to finance the purchase. Estimate how much cash Peter would need to prepare to close the deal, including various fees.
As the housing market has been going down in the past few months, Peter plans to buy an apartment in Kowloon as his primary residence for HK$6,500,000 this year. Peter is a Hong Kong permanent resident who does not own any other property in HK. The legal fee of the transaction is around HK$8,000. The commission is 1% of the purchase price. To be protected against potential damages caused by fire, landslip, or flood, Peter decides to buy the Fire and Applied perils home insurance as well for HK$12,000. For the stamp duty, please refer to the following table: or Value of Duty Payable Amount Consideration $1 - $2,000,000 $100 $2,000,001 - $2,351,760 $100+ [(consideration - $2,000,000) x 10%] Consideration x 1.5% $2,351,761 - $3,000,000 $3,000,001 - $3,290,320 $45,000+ [(consideration - $3,000,000) x 10%] $3,290,321 - $4,000,000 Consideration x 2.25% $4,000,001 - $4,428,570 $4,428,571 - $6,000,000 $90,000+ [(consideration - $4,000,000) x 10%] Consideration x 3% $6,000,001 - $6,720,000 $180,000+ [(consideration - $6,000,000) x 10%] Consideration x 3.75% $6,720,001 - $20,000,000 $20,000,001 - $21,739,120 $750,000+ [(consideration - $20,000,000) x 10%] Consideration x 4.25% $21,739,121 and above As the housing market has been going down in the past few months, Peter plans to buy an apartment in Kowloon as his primary residence for HK$6,500,000 this year. Peter is a Hong Kong permanent resident who does not own any other property in HK. The legal fee of the transaction is around HK$8,000. The commission is 1% of the purchase price. To be protected against potential damages caused by fire, landslip, or flood, Peter decides to buy the Fire and Applied perils home insurance as well for HK$12,000. For the stamp duty, please refer to the following table: or Value of Duty Payable Amount Consideration $1 - $2,000,000 $100 $2,000,001 - $2,351,760 $100+ [(consideration - $2,000,000) x 10%] Consideration x 1.5% $2,351,761 - $3,000,000 $3,000,001 - $3,290,320 $45,000+ [(consideration - $3,000,000) x 10%] $3,290,321 - $4,000,000 Consideration x 2.25% $4,000,001 - $4,428,570 $4,428,571 - $6,000,000 $90,000+ [(consideration - $4,000,000) x 10%] Consideration x 3% $6,000,001 - $6,720,000 $180,000+ [(consideration - $6,000,000) x 10%] Consideration x 3.75% $6,720,001 - $20,000,000 $20,000,001 - $21,739,120 $750,000+ [(consideration - $20,000,000) x 10%] Consideration x 4.25% $21,739,121 and above
