(Adds details, quotes, context)
BEIJING, March 24 China's central bank, wary of
soaring property prices in Beijing, said on Friday that banks
must strengthen mortgage risk management, and that includes
cracking down on home buyers rushing to get divorced to skirt
second-home purchase rules.
Growth in prices of Beijing homes in the resale market was
the third-fastest among Chinese cities in February, according to
the latest official data, mostly driven by speculators.
Individuals who have been divorced for less than a year
should not qualify as first-home buyers, and banks should not
extend property loans to such individuals under first-home
policies, the People's Bank of China (PBOC) said.
Last week, the Beijing municipal government imposed an
unprecedented series of curbs, including hiking the minimum down
payment ratio on second-home purchases to 60-80 percent. It kept
the rule on first-home buyers unchanged. First-home buyers need
only pay a minimum of 35 percent.
"Recently there have been more households that use divorces
to enjoy first-home mortgage policies," the Beijing operations
office of the PBOC said in a notice posted on its website.
"This has not only affected policy effectiveness, but will
also lead to problems such as financial disputes and add to
credit risks borne by commercial banks."
Under the PBOC guidelines for Beijing, effective
immediately, banks were also told to strictly check the source
of down payments by individuals purchasing property, carefully
assess the ability of borrowers to repay loans, and improve on
their residential property valuations.
The PBOC and the Beijing branch of the banking regulator
will conduct regular inspections and spot checks on how the
measures are implemented by banks, the notice said, stressing
that lenders that break the rules will be "dealt with
(Reporting by Ryan Woo and Yawen Chen; Editing by Michael