Getting a Mortgage In Singapore
Find out how to get a mortgage in Singapore and what criteria lenders may look at for approval.
Author: Pete Mugleston
CeMAP Mortgage Advisor, MD
We’ll explain the rules in Singapore for buying a home, how these rules apply to expats, and how a broker can help you secure the best rate.
How do mortgages work in Singapore?
When buying a home in Singapore, there are 2 main ways to finance it.
You would either use an HDB loan (Housing & Development Board) or finance it through a bank loan.
Both work in slightly different ways:
HDB loan
An HBD Loan requires at least one applicant to be a citizen of Singapore, and your household income can’t be higher than $14,000 for families, £7,000 if you’re a single occupant or $21,000 for extended families. The home you’re about to buy must also be your only potential home, as you cannot have owned a home in the last 30 months to qualify.
You can borrow up to 80% of the property value, and your loan period must be a minimum of 25 years. This means a 20% deposit is required. You can find detailed information on the HDB official website.
Bank loan
A loan from the bank will allow you to borrow up to 75% of the property value, so you’ll need a 25% deposit. There are 2 loan types available:
- Floating mortgage
- Fixed-rate mortgage
A floating mortgage is essentially the same as a variable mortgage in the UK, so the rate you pay will depend upon the Singapore Overnight Rate Average (SORA) or the Fixed Deposit Rate (FDR).
A fixed-rate mortgage will set your mortgage monthly payments at a set interest rate for some time. Your payments won’t change during this period, but once the period ends, you’ll need to consider options to either get another fixed-rate mortgage or opt for a floating mortgage.
Speak to an expert on overseas mortgages
How much could you borrow?
The amount you can borrow will be based on your Loan-to-Value ratio (LTV), Mortgaging Servicing Ratio (MSR) and Total Debt Servicing Ratio (TDSR)
Loan to Value ratio
As outlined earlier, the loan-to-value ratio will be capped at 80% for an HDB loan or 75% for a bank loan. Other factors, such as your Total Debt Servicing Ratio, might also affect this.
Total Debt Servicing Ratio (TDSR)
TDSR calculates how much of your income is used to pay off debts. If you get a mortgage, your mortgage plus any debts cannot exceed 55% of your gross monthly income.
Mortgaging Servicing Ratio (MSR)
This is only applicable to anyone purchasing through an HBD Loan. The MSR will check to make sure your monthly mortgage repayments don’t exceed 30% of your gross income.
Things to consider when getting a mortgage in Singapore
There are a number of other factors you should consider before pursuing a mortgage in Singapore, and they include…
The language
Many borrowers initially worry that contractual information regarding the terms of their mortgage can be lost in translation; however, often, both the seller of the property and the lender are fluent in English.
The most commonly spoken language in Singapore is English, followed by Malay and Tamil.
Do you pay stamp duty in Singapore?
Yes. Stamp Duty is payable on the property’s actual price or market price (whichever is higher) after you agree to purchase it.
Read the table below to see how Stamp Duty is calculated.
| Payment Schedule | % of Stamp Duty |
|---|---|
| First S$180,000 | 1% |
| Next S$180,000 | 2% |
| Next S$640,000 | 3% |
| Remaining Amount | 4% |
How much Stamp Duty is charged on a second property mortgage in Singapore?
If you buy more than one property in Singapore, you will be charged an Additional Buyer’s Stamp Duty (ABSD) on top of the standard Stamp Duty as above.
As a non-resident of Singapore, you will be charged as follows:
| 1st Property Purchase | 2nd Property Purchase | 3rd Property Purchase |
|---|---|---|
| 15% | 15% | 15% |
We're so confident in our service, we guarantee it.
We know it's important for you to have complete confidence in our service, and trust that you're getting the best chance of mortgage approval at the best available rate. We guarantee to get your mortgage approved where others can't - or we'll give you £100*
Get the best advice from an international mortgage broker
Applying for a mortgage for overseas property in Singapore can be daunting, but with the advice and professional help of a mortgage broker, it doesn’t have to be.
An experienced mortgage advisor can carefully check any Singapore lenders and ensure you understand the terms clearly before signing anything. They will also complete all necessary paperwork to get your mortgage approved.
If you have questions about getting a mortgage in Singapore and want to speak to an expert for the right advice, call Online Mortgage Advisor today on 0330 818 7026 or make an enquiry.
FAQs
Under the right circumstances, getting a mortgage while self-employed in Singapore may be possible.
Your approval for a mortgage will be subject to affordability checks, and you may be required to make a larger deposit of up to 40% of the property’s market value.
Additionally, the amount of debt you have can not exceed 70% of your take-home pay.
Pete Mugleston
CeMAP Mortgage Advisor, MD
Pete, a CeMAP-qualified mortgage advisor and an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete successfully went the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained and his love of helping people reach their goals led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.
Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for Online Mortgage Advisor of course!
Superb response and knowledgeable advisor
Steve, the financial advisor, contacted me within the hour and was very friendly, knowledgeable and professional. He seemed to relish my non standard requirement, diligently kept me updated during the day and we struck up a great relationship. Very impressed.
Peter Costello
Knowledgeable and Supportive
The team were fantastic and really knowledgeable and supportive. They answered all questions promptly and came back to me with regular updates. I have already recommended them and will use them again.
Dorothy
Prompt and Professional
A very prompt and professional service. The advise and guidance has been so valuable as a first time buyer.
Ayesha