Buying properties in Singapore requires a big financial commitment. Luckily, HDB loans can help you purchase properties within your financial means. But how much HDB loan can you get in Singapore?
You can get up to 80% of the property value in HDB loans. However, the amount of HDB loan you can get depends on several variables like your credit score, loan tenure and household income.

HDB loans are an excellent option to finance your new home because they give you more flexible refinancing options and allow you to make smaller downpayments compared to bank loans. In this article, we’ll explore HDB loans, how much you can get, and how to become eligible.

Factors To Consider When Buying A Home In Singapore


One of the most important factors to look out for when buying a home in Singapore is affordability. Currently, private properties cost an average of $2 million. This figure is well above the budget of many intending homeowners. However, HDB flats provide a cheaper solution as they are subsidised by the government. But even with HDB flats, it’s still important to choose properties that are within your financial means. This improves your chances of paying back the loans on time.

What’s The Initial Cost?

Another thing to consider when buying a home in Singapore is the initial costs of the HDB flat you’re purchasing. Although HDB loans cover a huge chunk of the money you’re paying for the property, you still have to pay for other upfront fees like:

  • Option fee
  • Stamp duty
  • Legal fees
  • Agent’s commission
  • Property valuation fee
  • Caveat registration fee
  • Survey and lease in-escrow registration fee
  • Renovation cost
  • Downpayment

Recurring Expenses

After paying for your HDB flat and moving in, there are still a few recurring expenses you’ll need to keep an eye on. You’ll need to pay a few monthly charges like service & conservancy charges and utility bills. As a homeowner, you should also factor in the possibility of rising interest rates, as it can affect your mortgage repayments. Another thing to keep an eye on is the value of the property. Property values in Singapore can fluctuate due to economic conditions, government policies, or market dynamics. Hence, you should be aware of these fluctuations as they could impact your property’s resale value.

Monthly Loan Instalments

Another thing to consider when buying a home in Singapore is the monthly loan instalments. The loan instalment amount can increase or decrease due to the principal amount borrowed, loan tenure, or the type of loan. Hence, it’s important to look for an affordable home loan option to ensure you aren’t paying a huge loan instalment every month.

Evaluating Your Financial Position When Buying A Home

Before buying a home in Singapore, you need to make a thorough assessment of your current financial position. This should give you an idea of whether you’re financially capable of purchasing an HDB flat and the type of flat you can afford. Let’s delve into the financial resources available to you to purchase a home.

Cash Savings

Cash savings can be an excellent financial safety net when buying a property in Singapore. They come in handy for various expenses like the initial downpayment, legal fees, renovation costs, and other surprises that often pop up.

So you’ll need to assess your cash savings and create a detailed inventory of your accounts, including checking and savings accounts, fixed deposits, and any other liquid assets. If you don’t have CPF funds to dip your hands in, bear in mind that you’ll need to pay the entire initial cost of your HDB flat using your cash savings.

CPF Ordinary Account Savings

Your CPF ordinary account savings can go a long way in financing your property purchase in Singapore. If you’re buying a private property, you’re allowed to pay 20% of the stipulated 25% downpayment with your CPF funds. But If you’re purchasing an HDB flat, you can pay the entire 20% downpayment using your CPF funds. Hence, you should evaluate your CPF savings to determine how much savings you can spare to cover part or the full downpayment for your HDB flat.

Proceeds from Sales

If you currently own property in Singapore, the proceeds from selling these assets can significantly boost your financial position for a new home purchase. Hence, you should carefully assess the potential sale value of your existing property. While assessing the value, be sure to consider the transaction costs involved, such as the agent’s commission and stamp duty for the new property.

Income Consistency

Your income situation needs to be rock-solid when buying a home in Singapore. For starters, you cannot get an HDB loan or any type of property loan if you don’t have a consistent source of income. So, make sure your income is consistent and dependable. If you’re struggling to meet your financial needs and require a reliable loan option, MPM Capital offers affordable loan packages to help you meet your needs. You can contact us today by clicking here to apply for one of our trusted loan packages.

What Determines Your Borrowing Capacity In Singapore?

In this section, we’ll be exploring the factors that determine how much you can borrow from financial institutions to fund your property purchase. They include:

Mortgage Servicing Ratio (MSR)

The Mortgage Servicing Ratio (MSR) is a fundamental metric when borrowing for a property in Singapore. It’s a financial safeguard put in place by the Monetary Authority of Singapore (MAS) to ensure that homebuyers don’t overstretch their finances.

In Singapore, the MSR stipulates that your monthly mortgage repayment cannot exceed 30% of your gross monthly income. So, if you earn $5,000 a month, your MSR limit for your property loan should not exceed $1,500 per month. This regulation ensures that you can comfortably manage your housing expenses without compromising your overall financial stability.

Total Debt Servicing Ratio (TDSR)

Another critical factor to consider is the Total Debt Servicing Ratio (TDSR). Think of it as a broader perspective on your financial situation. While MSR focuses on your housing expenses, TDSR considers all your outstanding debts, including credit card balances, car loans, and personal loans, in addition to your housing loan.

The TDSR cap in Singapore is set at 55% of your gross monthly income. So, if your total monthly debt obligations, including your prospective housing loan, exceed 55% of your income, you might face challenges securing additional credit. It’s a measure to ensure financial prudence and prevent borrowers from falling deeper into debt.

Loan-to-Value Limits

Loan-to-Value (LTV) limits are set by MAS and dictate how much you can borrow relative to the property’s value. These limits vary based on factors like the type of property, the number of existing mortgages you have, and whether you’re a first-time buyer.

LTV limits for residential properties range from 75% to 45%. For instance, if you’re a first-time buyer, you can borrow up to 75% of the property’s value. However, if you already have one or more outstanding property loans, your LTV limit will be lower.

Understanding HDB Loans in Singapore

HDB loans allow prospective homeowners in Singapore to purchase HDB flats under more flexible terms than bank loans. Before applying for an HDB loan, you’ll need to familiarize yourself with the following essential points:

Criteria for Eligibility For A Singapore HDB Loan

HDB loans come with specific eligibility criteria. To qualify for an HDB loan, you must meet conditions related to citizenship, age, income ceiling, and the number of residential properties you own. Failure to meet these criteria can result in your HDB loan application being rejected.

Variables Determining HDB Loan Amount

Several variables determine the amount of HDB loan you can get in Singapore. These include your household income, loan tenure, existing financial commitments, and your credit assessment by the financial institution.

The Significance of the HDB Loan Eligibility (HLE) Letter in Singapore

After you’ve met the eligibility criteria for an HDB loan, the next step is to get an HDB Loan Eligibility (HLE) letter. This letter provides you with crucial details about your loan, such as the loan amount, interest rate, and loan tenure. The HLE letter also serves as your pre-approval letter, which you’ll need when applying for an HDB flat.

The Difference Between Singapore’s HDB Loan and Bank Loans

HDB loans and bank loans differ in many respects. For example, while HDB loans require a lower downpayment, they generally offer less competitive interest rates compared to bank loans. Also, unlike bank loans, HDB loans do not attract penalties for early repayment.

Final Thoughts

Before you apply for an HDB loan, it’s crucial to assess your financial situation thoroughly. You can only find out how much you’re eligible to borrow after applying for an HDB loan. If you’re looking for a reliable loan option, MPM Capital offers affordable loan packages tailored to your needs. Click here to apply and take your first step towards home ownership today.