Step 6: Estate agents must not offer loans to prospective purchasers
According to the Practice Circular (No. 13-04 (CR)) issued by the EAA, estate agents must not offer or make loans to a prospective purchaser/flat viewer when promoting the first-sale units.
Even if a prospective purchaser states that he does not have sufficient money for the payment of the deposit on-site, or regardless of whether the loan is intended to persuade the prospective purchaser to sign a preliminary agreement for sale and purchase or for any other purpose, or even if the prospective purchaser requests the estate agents to do so, estate agents must not offer or make loans to the prospective purchaser.
Prospective purchasers are strongly advised to reject any offers or suggestions of loans or advances from estate agents. There have been past cases in which purchasers hastily made a purchase decision and accepted loans from estate agents to pay for the initial deposit of a first-sale unit, but they later discovered they lacked the financial capacity to proceed, resulting in the forfeiture of their deposits and financial losses.