Looking to buy a property in Singapore? Don’t wait until you’ve found that dream home to begin thinking about a home loan. OCBC Bank explains the basic information to know about obtaining a mortgage here.
1. Start early.
Consult a mortgage specialist early to find out your financing needs. They can also share with you the relevant regulations impacting foreigners buying property here.
2. Know the factors that affect your loan limits as an expat.
Government regulates the maximum Loan to Value (LTV) ratio at 80 percent (or 60 percent if you have an existing home loan), so you need to come up with the remaining portion from your own funds. Loan amounts for non-Singaporeans are based upon multiple factors, including:
3. Determine your loan tenure.
The maximum loan tenure is 40 years; however, the tenure can be less depending on the borrower’s age. With joint applicants, the loan tenure plus the age of the youngest borrower cannot exceed 75 years.
4. Choose your loan package.
Most banks offer three types of home loan packages: fixed, variable, and market-pegged rates. There is no interest rate volatility with fixed rate loans, but prepayments will incur penalties. Loans with variable and market-pegged rates usually allow prepayments and full loan settlement without penalty to the borrower. Make sure that you understand your needs and intentions before deciding which package is ideal for you.
Some banks offer free fire insurance for the first year as well as subsidised valuation and legal fees. However, conditions may be attached to such perks. These payments will have to be fully refunded to the bank if your loan is redeemed within the claw-back period, which varies from bank to bank.
To discover how OCBC can help you achieve your dream home in Singapore, call OCBC Bank at 1800 438 6088 or visit www.ocbc.com/personal today.
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