Hong Kong Association of Banks alternative means of payments of funds under payment arrangements for property transactions (‘PAPT’): Possible concerns from banks and clients

Abstract

Hong Kong Association of Banks, the DTC Association and the Hong Kong S.A.R. Licensed Money Lenders Association have been working on the provision of an alternative means of payments of funds under Payment Arrangements for Property Transactions, which aimed to enhance customer protection by allowing homeowners to refinance their mortgages without the assistance of law firms by asking their current banks to directly transfer their approved mortgages loans. Hong Kong Monetary Authority fully endorses and supports the initiative. It is argued that the newly proposed arrangement deliberately eliminated the role of law firms as an agent in the transfer of residential mortgage payments. The article argues that although the measure streamlines the process, it might be riskier than it is safe to forego solicitors when payment is involved due to the technical and legal reasons that would be explained.