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We know that understanding your home loan can be tough. It’s laden with complicated terms & jargon like TDSR, MSR, SIBOR, SOR, etc. Don’t get a headache trying to figure it out by yourself.
Our Mortgage Specialists will help you understand everything you need to know in simple, easy-to-understand terms.
If you’re trying to get your home loan on your own or through your real estate agent, good luck – there’s a higher than 95% chance you’re not getting the best deal.
Our Mortgage Specialists will help you compare loan options, assist with loan paperwork, and negotiate with the bankers until your home loan is settled.
The entire home loan process is tedious. You’ve got to deal with tons of paperwork, negotiation with bankers, and lots of running around.
Our Mortgage Specialists will help you compare loan options, assist with loan paperwork, and negotiate with the bankers until your home loan is settled.
So you found your dream home and are excited to sign on the dotted line. But before shelling out for a downpayment on that property that caught your eye, there are a few bases you need to cover.
Property Detail
Know Your TDSR
Under the latest Government regulations in Singapore, your Total Debt Servicing Ratio (TDSR) cannot exceed 60% of your income. That means that if you have any existing loans, such as a car loan or personal loan, you might be putting yourself over the 60% limit.
Loan Detail
Approval In Principle
Before you make the purchase, take some time to obtain Approval in Principle (AIP) from your bank of choice. The application procedure is rather tedious and involves quite a bit of paperwork, but it is necessary for the bank to review your credit history and financial health before approving the loan in principle. Once you have AIP, you have 1 to 3 months to purchase your home with more certainty that approval has been granted by a bank.
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Shop Around
You are not obligated to go with a bank just because it has pre-approved your loan. It is smart to seek pre-approval from multiple banks so you have options. The amount you can borrow will typically be the same across banks.
So you found your dream home and are excited to sign on the dotted line. But before shelling out for a downpayment on that property that caught your eye, there are a few bases you need to cover.
If you are denied AIP, it is usually due either bad credit history or your debt obligations being too high, so banks are not confident that you can repay the housing loan. Here is what you can do.
If appealing the rejection does not work, you will need to repair your credit history and improve your credit score before you can borrow from a bank. If you’ve filed for bankruptcy in the past, it takes 5 to 7 years before banks will be willing to lend you money again. If you cannot wait, you may want to try legal financial institutions like Singapura Finance instead.
Your TDSR, or portion of income committed to servicing debts, cannot be over 60%. So if you are already saddled with sizeable car loans, personal loans or credit card debts, your AIP request will be rejected. You can work around this by reducing the loan amount, extending your loan tenure or finding a cheaper house.
There is a special case, as many local banks avoid financing Geylang property due to its reputation as a red light district. If you’ve got your heartset on a Geylang home, try foreign banks which might be more amenable to such loans.
