Buying a flat is a long term financial commitment. Plan early and ensure sufficient funds before committing to one. Here is a checklist to help you along.
Step 1: Know Your Ability to Pay
• Before you decide on the flat to buy, check how much you can comfortably pay every month as part of the housing loan instalment.
• Use the Cash Flow Planner to track your monthly earnings and expenses to know your monthly cash flow position.
(Tip: As your financial situation may change over time, you may wish to consider the amount of cash you need to sustain the monthly loan repayments.)
Step 2: Work out Your Budget
• Your budget to buy a flat is made up of:
– CPF savings in the Ordinary Account;
– CPF housing grants (if eligible);
– Cash savings to minimise housing loan needed;
– Housing loan amount you can take out
• You do not need to take up the maximum loan that is offered. Consider what would be the amount that you can comfortably pay every month after setting aside sufficient funds for living and other expenses, as well as for emergencies.
(Tip: Keep within your budget for long term sustainability.)
Step 3: Check Your Loan Eligibility
• Eligibility conditions and loan assessment criteria have to be met before you can take out a housing loan.
• Place a deposit/option fee for a flat only if it is within your budget.
• For a housing loan from banks and financial institutions regulated by the Monetary Authority of Singapore, check your loan eligibility and the terms and conditions of the loan being offered.
• For a housing loan from the HDB, apply for an HDB Loan Eligibility letter online at HDB InfoWEB – fill in personal particulars of applicants, attach all the required documents and get all applicants to sign electronically using their SingPass.
(Tip: Housing loan quantum is calculated based on your financial situation, up to the loan-to-value limit of the flat you intend to buy.)