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The following is issued on behalf of the Housing Authority:
A spokesman for the Housing Authority today (November 27) reminded owners under the Private Sector Participation Scheme (PSPS), Home Ownership Scheme (HOS) and Tenants Purchase Scheme (TPS) to strictly observe the alienation restrictions as laid down in the Housing Ordinance as these flats were sold at discount prices.
"Any form of alienation of their flats, creation of a mortgage or charge over the flats, are not permitted unless with prior approval of the Director of Housing," the spokesman said.
"Any person who commits an offence of unauthorised alienation under section 27A of the Housing Ordinance is liable to a maximum fine of $500,000 and one year's imprisonment," he said.
The reminder follows a court case last Wednesday (November 23) in which a PSPS owner was convicted and fined HK$27,000 for committing an offence of unauthorised alienation.
The owner purchased a PSPS flat in December, 1987. He applied to the Housing Department for premium assessment in April, 2005. During the course of processing the premium application, it was noted that he had executed a loan agreement with a charge over the property without prior approval from the Director of Housing.
This is the second convicted case. In July this year, a PSPS owner was ordered to serve 100 hours of community services for committing a similar offence.
"The loan agreement provides, among others, that the PSPS property be charged unto the Lender as security for repayment of the loan. In the event of default in payment of the loan or any of the installments, the Lender shall have the power to enter into possession of the property and to dispose of the same by public auction or private treaty," he said.
The spokesman pointed out that owners seeking for re-financing arrangements by charging their flats should pay the assessed premium to the Housing Authority to uplift the alienation restrictions before proceeding to mortgage the property.
"Starting from May this year, HOS/PSPS and TPS flat owners can choose to pay the premium after the lapse of the first two-year alienation restriction period," the spokesman said.
"Owners with genuine financial hardship, with prior approval from the Director of Housing, can apply for re-financing of their flats without paying premium first," he said.
The spokesman stressed that the department adopted a zero tolerance policy against unauthorised alienation and would carry out prompt investigation and institute prosecution action as appropriate.
"The alienation restrictions have clearly been stipulated in the application forms, sales brochure and conveyancing document before the sale of flat as well as widely publicised on the Housing Authority/Housing Department's website, hotline, and other information leaflets," he said.
Ends/Sunday, November 27, 2005
Issued at HKT 11:28
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