CITY banks were ordered to fulfill contracts in which discounts of 10 to 15 percent were offered on standard mortgage rates, Chinese-language media reported yesterday.
The city banking watchdog made the order in response to a joint complaint filed by about 200 homebuyers.
It s illegal for banks to break clauses in the loan contracts unilaterally, said Xiong Liangjun, director of the city s banking regulation commission.
The 10- and 15-percent discounts previously agreed between banks and homebuyers should be continued.
Xiong said the commission had talks with people in charge of the Shenzhen branches of the Industrial and Commercial Bank of China (ICBC), China Construction Bank and Communications Bank on the issue.
As long as the discount offer is stated in the contracts, which have been filed with the banking system, it is legally valid, he said.
Early this week, about 185 people joined a group on the Internet, named victims of bank breaches on loan interest, complained that banks had broken a promise on discounted mortgage rates and instead demanded higher interest. The ICBC was the target of most complaints.
The homebuyers claimed that they had received a letter of commitment from the banks in December, promising a 15-percent discount on their home loans. However, they were then told they would have to pay interest at higher rates.
It was reported that the banks had changed interest rates because of the country s increasingly tougher stance on bank lines of credit. Banks usually reached an oral agreement with borrowers for interest rate discounts, which made it impossible for borrowers to protect their rights through legal avenues.
(SD News)
