Apr 28, 2010
Loansharks target flat sellers
Govt drafting measures to curb exploitation of cash-strapped owners
<!-- by line --> By Rachel Lin
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'HDB flats are not meant for short-term profit,' MND Minister Mah Bow Tan said in Parliament yesterday. 'They are not meant to be used as collateral for loans, whether to legal or illegal moneylenders.' -- ST PHOTO: TERENCE TAN CS
<!-- story content : start --> THE Ministry of National Development (MND) has sent a clear message to moneylenders who exploit cash-strapped HDB sellers: The game is up. It is drafting measures to crack down on these unscrupulous credit companies, which lend money to home owners on the condition that they repay the loan from the sale of their flats. The moneylenders usually collude with real estate agents who, in return for a referral fee, link them up with home owners.
In addition, a legal loophole allows moneylenders to file a caveat on the flat, which ensures that they get first bite of the proceeds when the flat is sold. 'HDB flats are not meant for short-term profit,' MND Minister Mah Bow Tan said in Parliament yesterday. 'They are not meant to be used as collateral for loans, whether to legal or illegal moneylenders.' 'My ministry is currently working with the relevant authorities on appropriate measures to curb such abuses. Existing measures have not been sufficient to deal with the problem, Mr Mah added.
Read the full story in Wednesday's edition of The Straits Times.
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