Hong Kong Mortgage Insurance (2026): Premiums and Whether It's Worth It

Banks generally lend up to 60% of value. To borrow more, the portion above that cap is insured by HKMC Insurance under the Mortgage Insurance Programme. The buyer pays the premium, but the policy protects the bank — a point that is widely misunderstood.

You still have to pass the bank's income and stress tests, and insured loans are typically assessed more strictly on debt-servicing ratio and proof of income. Self-employed and variable-income applicants are approved less often.

The premium is a percentage of the loan, rising with loan-to-value and tenor. You can pay it in one lump sum (which may be added to the loan and repaid over the term) or annually. Adding it to the loan means paying thirty years of interest on the premium too.

On a HK$8m flat at 80% LTV (a HK$6.4m loan) over 30 years, a single premium of roughly 4% of the loan is about HK$250,000. Financed into the loan, the true thirty-year cost can exceed HK$450,000.

High-LTV lending is capped by property price, and the maximum LTV steps down as the price rises. Confirm the caps in force with your bank or HKMC before offering — the HKMA and HKMC adjust them with market conditions.

Building age and property type (village houses, converted industrial units, unpremium-paid subsidised flats) also affect both LTV and insurability. The commonest reason a high-LTV deal fails is a valuation below the agreed price: the shortfall must be covered in cash.

Sources: HKMC Insurance mortgage insurance premium schedule; HKMA loan-to-value guidelines. Solicitors' fees are not fixed by statute — the ranges below reflect common market quotes; rely on your own firm's quotation.

In favour: you buy sooner with less cash and keep a reserve. Where rent exceeds the difference in monthly outgoings, buying earlier can pay.

Against: the premium plus interest on the extra borrowing often equals 3% to 6% of the purchase price. Negotiating the same percentage off the price achieves the same result without the premium — and also reduces stamp duty and commission.

The practical order: price the two scenarios — 80% LTV with insurance versus 60% LTV after negotiating 5% off — over thirty years before committing. Negotiate first, then decide the LTV.