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Wealth

Evergrande’s Hong Kong Buyers Panic as It Halts Risky Lending

  • Buyers of Evergrande struggle to replace developer’s financing
  • HK developers would provide mortgage to buyers to boost sales
Florence Mok, front second left, and other buyers of the Vertex hold protests signs on May 14.
Florence Mok, front second left, and other buyers of the Vertex hold protests signs on May 14.Photographer: Bertha Wang/Bloomberg
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Florence Mok, a new mother, thought she wouldn’t be able to get a mortgage for her HK$9 million ($1.1 million) dream apartment. When her family signed the papers, China Evergrande Group sales staff said not to worry. The developer’s financing arm offered them 90% leverage, no bank stress-test needed.

Now Mok’s suffering from the fallout of Evergrande’s debt crisis. With the cash-strapped company no longer willing to provide financing, her family can’t find a bank for a mortgage. They might lose the down payment and apartment.