HDB Home Loan

⁺Terms and Conditions:

• This Promotion is not valid with third party referrals. Letters of offer issued by UOB in connection with the UOB HDB Home Loan have to be accepted within the campaign period of 1 July 2022 to 9 January 2023.
• UOB may vary or suspend or terminate this Promotion without notice. Full terms and conditions apply; please see T&Cs.

Home ownership is a long-term commitment that requires you to set aside a significant sum of money as a deposit and to then make regular mortgage repayments over the tenor of the loan. Before you decide to upgrade to a larger or private property, you should speak to your bank to confirm how much you can borrow to upgrade to a new property.

For example, the maximum home loan quantum that you can borrow from a bank is determined by the Loan-to-Value ratio or LTV. The LTV considers three factors – the loan tenor, your age and the number of outstanding home loans you have. However, there is an exception if you are upgrading from your HDB flat. In such cases, the outstanding home loan on your HDB flat will not affect the maximum home loan amount for the new property as long as you can provide the necessary documentation to show that your flat has been sold. These include a copy of the approval letter by HDB and a copy of the Borrower’s letter of undertaking to complete the sale of the existing HDB flat.

With these documents, your bank can provide you with an In-Principle Approval so that you can have certainty on your eligible loan amount and monthly mortgage repayment amount. This will help guide you to determine the down payment amount needed to purchase a new property and if you can commit to the monthly mortgage repayments.

With UOB Instant Home loan approval, you can get an in principle approval online, in the comfort of your home within minutes.

If you want to purchase a second property and already have an existing housing loan on your current flat, you will only be allowed to borrow up to 45 per cent of the value of your new property. This is provided that at the point of application, the loan tenure (i) is less than 30 years; and (ii) does not extend past age 65. Should these criteria not be made, you will only be eligible to borrow up to 25 per cent of the value of your new property. You can approach our Mortgage banker for calculation and your eligible LTV.

When you sell your HDB flat, you can use the net sales proceeds to purchase your next property. The net sales proceeds received by homebuyers is less any outstanding loan balance and the amount of CPF plus accrued interest used for the existing property.

Although you can use the savings in your CPF Ordinary Account (OA) to pay down your monthly home loan installment, there is a limit. It is important that you know what your CPF Withdrawal Limit is, as you will need to pay your monthly mortgage amount in cash should you reach the cap.

The CPF Withdrawal Limit is capped at 120 per cent of the Valuation Limit of your property. The Valuation Limit is the lower of the purchase price or valuation amount at the point when you purchased your property.

For example, if you purchased your HDB flat at $500,000 and its valuation at the point was $530,000, the Valuation Limit will be $500,000. This means that your Withdrawal Limit will be $600,000, or 120 per cent of the Valuation Limit.

A bridging loan provides short-term financing to complete the purchase of a new property before the homebuyer receives the proceeds from the sale of their existing property.

The quantum for a bridging loan is determined by the nett proceeds from the sale of the property. The nett sales proceeds is calculated based on several components such as the selling price and outstanding loan balance for the existing property and the amount of CPF plus accrued interests that have been used for the existing property.

A bridging loan is a short term loan of up to a maximum of 6 months. The loan tenor is dependent on the needs of the customer.

The interest rate for a bridging loan is between 4% and 5% (accurate as of December 2020) and differs from bank to bank.

The maximum tenor for a bridging loan is six months and full repayment must be made by the end of that period. The monthly repayments are only on the interest charged, with no repayment on the Principal amount, which is repaid in full at end of the tenor. The principal amount can be repaid using either cash or CPF, subject to the CPF Withdrawal Limit.

Generally, no prepayment fee is levied for early redemption of the Bridging Loan before maturity date.

Bridging Loans can be used for the purchase of private properties, HDB flats and Executive Condominums or ECs. Customers who require a bridging loan for the purchase of an Executive Condominium which is still under construction should apply for the loan under the Deferred Payment Scheme offered by the property developer.

You should apply for a Bridging Loan when applying for your Housing Loan. You may receive the approval for your bridging loan within two working days on condition that all necessary documents have been submitted.

• The loan repayment schedule for the loan package that you have chosen is available in either hard copy (on request) or soft copy in the form of a home loan calculator on the bank's website.
• The Association of Banks in Singapore's (ABS) Consumer Guide on Home Loans is available and you are encouraged to get a copy from the bank and read it before committing to a loan. This guide is also available on the MoneySENSE and ABS websites in four official languages

This publication is strictly for information purposes only and shall not be transmitted, disclosed, copied or relied upon by any person for whatever purpose. This publication is not an offer, recommendation, solicitation or advice to buy or sell any investment product. Nothing in this document constitutes accounting, legal, regulatory, tax, financial or other advice. You should consult your own professional advisors about issues discussed herein. While the information provided in this publication is believed to be accurate as at the date of publishing, UOB makes no representation or warranty, and accepts no responsibility or liability for its completeness or accuracy.