Financing your Flat Purchase

This information can guide you in planning the finances for your flat purchase and deciding on the flat choices within your budget, making it easier when it comes to searching for a suitable home.
 
To work out a comprehensive financial plan, be sure to consider the following:
  • Cash and CPF Ordinary Account savings
  • Housing loan
  • CPF Housing Grants
  • Payments required
For a start, you can use our calculators to determine your current finances and how much you can borrow for your flat purchase. Read for more guidance on financing a flat purchase.

Cash and CPF savings

You would probably use both cash and CPF savings for your flat purchase. Your resale flat financial planning should therefore cover:
  • Amount of cash required
  • Amount that can be paid using CPF savings

Cash savings

You must use cash for the following payments:
  • Deposit to seller (a maximum of $5,000, paid in 2 stages: the option fee, and the deposit)
  • Part of the initial payment (if you take a bank loan, or have insufficient CPF savings)
  • Amount not covered by CPF savings and eligible housing loan amount
  • Cash proceeds from disposing the last flat if you are taking a second HDB loan*
*If you are taking a second HDB loan to buy the resale flat, you will need to set aside part of the cash proceeds from the disposal of the existing or previous flat. That amount will be used to right-size the loan amount for your second HDB loan.
 
You will also need to set aside cash savings for other expenses such as furnishings, renovation, and some other costs and fees payable .

CPF savings

The savings in your CPF Ordinary Account (OA) can be used for:
  • Initial payment in whole or in part (depending on whether you are taking an HDB housing loan or a bank loan)
  • Partial or full payment for the flat purchase
  • Monthly payments of mortgage instalments

However, do take note that there is a limit on the total amount of CPF money that can be used for your flat purchase. Once that limit is reached, you will not be able to withdraw more of your CPF savings to pay for the flat.

Flat buyers taking an HDB housing loan will have the option of retaining up to $20,000 of the available CPF savings in each buyer's Ordinary Account (OA). The rest of the available CPF OA balance must be used to pay for the flat purchase.

From 10 May 2019, the total amount of CPF money that can be used for your flat purchase will depend on the extent the remaining lease of the flat can cover the youngest buyer up to the age of 95. Details on the use of CPF savings and the applicable limits are shown in the Tables below.

For flat applications received on or after 10 May 2019:

Remaining lease of flat is at least 20 years and can cover the youngest buyer up to the age of 95 Applicable Limits for CPF Usage
Yes

The amount of CPF money that the buyers can use is capped at the lower of the valuation or the price of the flat at the time of purchase.

No

Use of CPF money will be pro-rated based on the extent the remaining lease of the flat can cover the youngest buyer up to the age of 95. This will help the buyers to set aside CPF savings for their housing needs during retirement (e.g. buying a replacement property).

For information on the use of your CPF money to buy a flat, you may use the online calculator at CPF Board’s website.

For flat applications received before 10 May 2019:

Remaining lease of flat Applicable Limits for CPF Usage
60 years or more

^The amount of CPF money that buyers can use is capped at the lower of the valuation or the price of the flat at the time of purchase.

More than 30 years but less than 60 years
  • Buyers can use their CPF money if the remaining lease of the flat can cover the youngest buyer up to the  age of 80

  • Total amount of CPF money that can be used is capped at the lower of the valuation or the price of the flat at the time of purchase.

^Further withdrawal of CPF money (up to applicable limits)  for the flat purchase may be allowed if the buyers are able to set aside the Basic Retirement Sum in their CPF accounts. 

For further enquiries on the use of your CPF money to buy a flat, please call CPF Board Service Line at 1800-227-1188 during office hours.

Information on the remaining lease of an HDB block is available on the HDB Map Services under "Housing".

Housing loan 

To finance your flat purchase, you may choose to get a housing loan from HDB or a financial institution (FI) regulated by the Monetary Authority of Singapore.

To take out a housing loan, you need to meet the eligibility conditions and credit assessment criteria. You must also take note of the following financing requirements:

If you take a housing loan from HDB

You must have a valid HDB Loan Eligibility (HLE) letter when obtaining an Option to Purchase (OTP) from a flat seller and at the time of your application to buy the resale flat.

The HLE letter will inform you of the housing loan amount you can get. Do exercise prudence and take on a loan amount that you can service comfortably over the loan tenure.

If you take a housing loan from an FI

You must obtain a Letter of Offer from the FI before you exercise an OTP.

 
 

Housing Loan from HDB

We provide housing loan to eligible flat buyers. The housing loans amount is subject to credit assessment and the prevailing eligibility conditions.

We provide housing loan to eligible flat buyers. The housing loan amount is subject to credit assessment and the prevailing eligibility conditions.

If you wish to take out an HDB housing loan, you need to first apply for and obtain an HDB Loan Eligibility (HLE) letter. The HLE letter will inform you of the loan amount you can receive, based on your financial situation. As a good practice, obtain an HLE letter before you start searching for a flat, as knowing the available housing loan amount will help you to estimate your flat budget.

If you take a housing loan from HDB, do note the following:-

  • You will need to have a valid HLE letter when you book a flat from HDB, or obtain an Option to Purchase (OTP) from a flat seller.
  • When you take a housing loan from HDB, you can later refinance the loan with another housing loan from a financial institution (FI). However, if you take a housing loan from an FI, you will not be allowed to refinance the loan with an HDB housing loan subsequently.
  • If you are taking a second HDB housing loan, the eligible loan amount will be reduced using the CPF refund and part of the cash proceeds from the disposal of your last-owned flat.
  • Those taking an HDB housing loan will have the option of retaining up to $20,000 CPF savings in each buyer's Ordinary Account (OA). The rest of the available CPF OA balance must be used  to pay for the flat purchase. Those taking a housing loan from FIs may check with the FIs for their conditions.
  • For those who buy a flat with a remaining lease that can cover the youngest buyer till the age of 95, the maximum HDB housing loan amount they may take will be up to 90% of the lower of the flat’s purchase price or value (“90% loan-to-value”).
  • For those who buy a flat with a remaining lease that cannot cover the youngest buyer till the age of 95, the maximum HDB housing loan amount that they may take will be pro-rated from the 90% loan-to-value limit.
  • Buyers of flats with less than 20 years of remaining lease are not eligible for an HDB housing loan

Use the following online calculators to compute the allowable CPF usage and the HDB housing loan:

Information on the remaining lease of an HDB block is available on the HDB Map Services under “Housing”. For more details, please refer to Housing Loan from HDB.

Housing Loan from Financial Institutions

You can choose to finance your flat purchase with a housing loan from the financial institutions (FIs) regulated by the Monetary Authority of Singapore (MAS).

You can choose to finance your flat with a housing loan from the FIs regulated by MAS. If you take a housing loan from an FI, you will not be allowed to refinance your loan with a housing loan from HDB.

When choosing a housing loan from an FI, assess the different housing loan packages offered by the FIs thoroughly and weigh your options carefully. Some key terms and conditions to look out for include lock-in periods, interest rates, and other financial considerations.

If you take a housing loan from an FI, do note the following:-

  • You must have a valid Letter of Offer before you exercise the Option to Purchase for the HDB resale flat
  • You will not be allowed to refinance the loan with a housing loan from HDB

For more details, please refer to Housing Loan from Financial Institutions.

CPF Housing Grant Scheme

You may find out whether you are eligible for any CPF housing grants, which are housing subsidies given by the Government to eligible Singapore Citizen buyers. The housing grant can be used for the initial payment and to reduce the required housing loan amount.

Find out about the different types of CPF housing grants.

Payments required

The main payments you need to make for a resale flat purchase are as follows:
  • Deposit to flat seller (option fee and deposit)
  • Initial payment
  • Cash payment for balance purchase price (if applicable)
There are also additional costs and fees that you need to be aware of.

Deposit to Seller

This amount can be negotiated with the seller and is taken off the resale price.
 
Amount to Pay
Payment Mode
When to Make Payment
Up to $5,000 in total, paid in 2 stages.
Cash
1) Granting of OTP
Up to $1,000 is paid as the option fee.
2) Exercising of OTP
A deposit of up to $4,999 (cap of $5,000 minus the option fee amount) is paid.
 

Initial payment

You make the initial payment after acknowledging the resale documents in the HDB Resale Portal. The amount is based on the resale price or market valuation of the flat, whichever is lower, as well as whether you are:

  • Taking an HDB housing loan
  • Not taking any housing loan
  • Taking a bank loan
Housing Loan Type
Initial Payment
Mode of Payment
When to Pay
HDB loan/ Not taking any housing loan 10% of the purchase price

CPF

You can use your CPF OA savings (including CPF Housing Grant if eligible) to make the initial payment up to the full 10%. If your CPF OA amount is insufficient, the balance is to be paid in cash.

If you intend to use  more than 10%  of the purchase price of the flat from your CPF,  you must have this amount available in your CPF account before submitting the resale application. Additionally, do note that flat buyers taking an HDB housing loan will have the option of retaining up to $20,000 CPF savings in each buyer's Ordinary Account (OA). The rest of the available CPF OA balance must be used to pay for the flat purchase.

Online withdrawal of your CPF monies after you confirm your Financial Plan through the HDB Resale Portal

Cashier's Order
 
At the resale completion appointment
Bank loan
25% of purchase price for loan ceiling of 75%

CPF

You can use your CPF OA savings (including CPF Housing Grant if eligible) to make the initial payment up to 20%. If your CPF savings is insufficient, the balance is to be paid in cash.

Please check with the bank for the payment schedule for your bank loan
Cash (minimum of 5%)
45% of purchase price for loan ceiling of 55%

CPF

You can use your CPF OA savings (including CPF Housing Grant if eligible) to make the initial payment up to 35%. If your CPF savings is insufficient, the balance is to be paid in cash.

Cash (minimum of 10%)

Cash payment for balance purchase price

The cash payment for balance purchase price only needs to be paid when the resale price is higher than the market valuation.
 
Amount to Pay
Housing Loan Type
Payment Mode
When to Make Payment
The difference between the resale price and the market valuation
HDB loan/ Not taking any housing loan

Cashier's Order

At the resale completion appointment
Bank loan Cash Please check with the bank for the bank loan payment schedule