Effortless Housing Loans – Your Path to Home Ownership in Singapore
From keys to comfort, we got you covered with tailored housing loan solutions
Chat with our Mortgage Experts to Learn MoreWhether you are a young entrepreneur eyeing a studio apartment or a family seeking a cozy home, buying a house is probably one of the most important decisions you’ll make in your lifetime. Choosing the right mortgage is crucial not just to obtain your dream home but to save you money that can be utilised for other expenses.
The first step is to understand your financial options. From fixed-rate packages to SORA-linked mortgages, these terms might seem complex at first glance. Don’t be overwhelmed, we will walk you through the essentials from comparing home loan interest rates to repayment terms and borrowing limits to help you find the best loan for your needs.
A Breakdown of Home Loan Options in Singapore
Planning to buy a home in Singapore? Let’s get a clear understanding of your mortgage options to ensure your decisions align with your financial goals:
HDB Concessionary Loans
Offered directly by the Housing & Development Board currently at a fixed interest rate of 2.6% p.a., it offers predictable repayments and Loan-to-Value (LTV) limits of up to 75%, but is only available for eligible Singapore citizens or PR holders buying an HDB flat.
Bank Loans–Fixed and Floating
Banks provide both fixed-rate and floating-rate packages. Fixed rates offer stability for a set period (usually 1 to 5 years), though initial rates may be slightly higher.
Floating rates are linked to SORA or fixed deposit-linked rates (FDR), which means depending on the market, the repayment amount could increase or even reduce. They suit loan applicants who are comfortable with rate fluctuations.
Non-Bank Financial Institutions
Apart from banks, some financial institutions also offer housing loans. Their packages can sometimes be more flexible and occasionally lower than HDB loans, but interest rates may vary more widely. Loan terms and eligibility criteria may also differ, so it’s important to review the conditions carefully before committing.
Why Choose heyphillip?
From application to approval, at heyphillip we simplify the process with expertly tailored solutions to helping you secure the right housing loan with ease. We offer:
Personalised mortgage advice tailored to your financial goals
Assistance with in-principal approval to get your loan pre-approved
Smart calculators to quickly estimate your mortgage and gauge eligibility
Instant comparison tools showcasing the best current mortgage offers from top banks and lenders
With heyphillip by your side, you can pursue the best home loans Singapore has to offer with confidence and clarity. Get in touch with our consultants at callme@heyphillip.com to find the best rate!
How Much Can You Borrow?
Want to know your borrowing ceiling? Firstly, you need to get an understating of these ratios and what they mean:
Loan-to-Value (LTV):
In Singapore, LTV limits define how much of the property value you can loan. It is currently capped at 75% for both HDB and bank loans.Understand Total Debt Servicing Ratio (TDSR) & Mortgage Servicing Ratio (MSR):
This limits the portion of your gross monthly income that goes toward repaying your debts to 55%.
This is mainly applicable for HDB and executive condominium financing and confines your housing loan repayments to 30% of your income.
Hidden Costs & Loan Management
Beyond the interest rate, several additional costs can impact your total cost of borrowing:
You may need to pay the legal fees upfront or negotiate with your lender.
Banks often defray some fees such as valuation and administrative charges, but it varies.
Beware of costly lock-in penalties as refinancing early may cost you, especially during the fixed-rate or promotional period.
Homeowners also need to keep track of the expiry of the lock in date.
Tread carefully with switching or choosing repricing options as some package conversions are free after the first year. They are helpful if the interest rate drops or during a scenario where interest rates rise, therefore, a fixed rate can be locked in to prevent overpaying.
Managing these factors can prevent unwelcome surprises and costs down the road. At heyphillip, we also assist in sourcing reputable law firms with affordable fees, that is on the bank's panel. Feel free to contact your mortgage experts for guidance and information on managing your loan.
Guide to Getting a Home Loan
Step 1: Assess Your Eligibility:
Evaluate your financial profile from income and credit score to TDSR/MSR and the type of property you intend to buy as these factors determine the borrowing limit and the packages.
Step 2: Use Tools & Get In-Principle Approval (IPA):
Begin with tools such as heyphillip's calculators to explore possible packages. Then, apply for an IPA (a conditional approval letter that gives you negotiation power and clarity). These are typically valid for 30 to 90 days.
Step 3: Compare Loan Packages and Rates:
Don’t just chase the lowest home loan interest rate, also examine lock-in durations, repricing flexibility, penalties, and lender support quality.
Step 4: Application & Documentation:
Prepare and submit your NRIC, income statements (e.g., payslips), CPF contribution summary, and property documents such as the Option to Purchase (OTP) or Sales & Purchase Agreement.