When you purchase an HDB resale flat, there might be other costs and fees on top of the selling price of the HDB flat that you need to take into consideration when working out your financial plan.
- Resale application administrative fee
- Valuation fee
- Insurance
- Administrative fee for Temporary Extension of Stay by Flat Sellers
- Legal fees
Speak to your Ping Property Agent to help you to work out a comprehensive financial plan which includes:
- Cash and CPF savings
- Housing loan
- CPF Housing Grant Scheme
- Payments involved
Cash and CPF savings
You will probably use both cash and CPF savings for the flat purchase. Your resale flat financial planning should therefore cover:
- How much cash is required
- Amounts that can be paid using CPF savings
The savings in your CPF Ordinary Account (OA) can be used for:
- Initial payment in whole or in part (depending on whether an HDB or bank housing loan is used)
- Partial or full payment for the flat purchase
- Monthly mortgage instalments
CPF Housing Grant Scheme
For eligible Singapore Citizens, you may be eligible for CPF housing grants, which are housing subsidies given by the government. They can be used for a flat’s initial payment and for reducing the housing loan amount. CPF grants are given in the form of OA savings.
Housing loan
In order to finance the purchase of your HDB flat, you may choose to apply for a housing loan from HDB or a housing loan from banks regulated by the Monetary Authority of Singapore. To apply for a housing loan, you need to meet the eligibility conditions and credit assessment criteria.
Before you exercise the Option To Purchase, you must obtain a valid HDB Loan Eligibility (HLE) letter, if you take on a housing loan from HDB. The HLE letter will inform you of the loan amount you can get from HDB. Be prudent and take on a loan amount that you will feel comfortable paying monthly over the loan tenure. You can apply for an HLE letter here.
If you are unsuccessful in obtaining a housing loan from HDB, you will need to obtain a mortgage loan from a bank. A Letter of Offer must be obtained from the bank before you sign the Option To Purchase.
For flats with a remaining lease of less than 60 years, do note that there may be limits on the use of CPF savings and taking of a housing loan for the flat. Information on the remaining of an HDB block is available on the HDB Map Services under “Housing”.