China   REAL ESTATE MORTGAGE LOANS BANKS
The credit for real estate acquisition in China
Restrictions on real estate acquisition in China, use of apartment or other real estate in the Peoples Republic of China in own personal purposes, tenancy, contradictions in the legislation of the Peoples Republic of China and new acts

The branch or representation of the foreign company also can issue the hypothecary credit for real estate purchase in China. For this purpose it is necessary to submit following documents: registration documents of the company (the certificate on check in, the certificate on assignment of a uniform code of the enterprise, the certificate on check in in management of local and state taxes, etc.), accounting reports for last 3 years, the decision on a filing of application on the reception of the credit signed by the Chairman of board of directors of the company, the credit demand, a map on the credit reception, issued in National bank of China.

The hypothecary credit can be given out the enterprise a maximum for 5 years, under condition of payment of 50 % from a total cost of the real estate as an initial payment.

If the company exists less than 3th years then crediting is possible if the foreign bank gives out a guarantee or opens the reserve letter of credit in favour of this company for a period of 1 year with possibility of annual prolongation.

The average interest rate under the hypothecary credit is defined by the decision of National bank of China.

For the companies from 100 % the foreign capital getting the real estate in China, restrictions do not exist. However, according to last changes in the legislation, the company with the foreign capital cannot lease the given real estate and officially to receive from it the income if in the certificate on the activity right the given field of activity is not designated. Thus, under the civil code of China, the company can lease the excessive area.

At the moment in the legislation there are the certain contradictions, new acts are in a preparation stage, but the authorities of China yet do not inform neither the approximate maintenance, nor an exact times of release of these documents.

If the purpose of your company is real estate acquisition in China which you will partially use in own purposes, and partially to lease, rent reception informally or declaring of this income under other article will be an exit from the given situation.