Wednesday, October 28, 2015

Financing an Executive Condominium

Costs of Buying an Executive Condominium

Costs involved are:
. Purchase Price
. Stamp Duty = Purchase Price x 3% – $5,400
. Legal fees

No agent commission or fee payable. ECs are also NOT affected by Additional Buyers Stamp Duty.

Sources of Funds
. Minimum 5% must be from your own cash.
. CPF Housing Grant for first timers.
. Your CPF funds in OA (Ordinary Account).
. Bank Loan. HDB does not give loans for ECs.


CPF Housing Grant (Source: HDB)



Only first timers are eligible for this grant. For details & eligibility conditions, see HDB Website.* If you are from an SC/SPR household, you can enjoy the full housing subsidy by applying for the Citizen Top-Up when your SPR family takes Singapore Citizenship or when you have an SC child.

Financing for Executive Condominiums

Financing for executive condominiums are typically from banks or financial institutions as HDB does not loan for ECs.

Government regulations for loans are as follows:
No current housing loan + tenor ≤ 30 years + age at end of tenor ≤ 65 = max 80% loan.
Minimum cash downpayment = 5%.

No current housing loan + tenor ≤ 30 years + age at end of tenor is 66 – 75 = max 60% loan.
Minimum cash downpayment = 10%.

No current housing loan + tenor is 31 – 35 years + age at end of tenor ≤ 75 = max 60% loan.
Minimum cash downpayment = 10%.

Outstanding housing loan + tenor ≤ 30 years + age at end of tenor ≤ 65 = max 50% loan.#
Minimum cash downpayment = 25%.

Outstanding housing loan + tenor ≤ 30 years + age at end of tenor is 66 – 75 = max 30% loan.
Minimum cash downpayment = 25%.

Outstanding housing loan + tenor is 31 – 35 years + age at end of tenor ≤ 75 = max 30% loan.
Minimum cash downpayment = 25%.

If you require financing, it is highly advisable to obtain an In-Principle Approval (IPA) letter in advance before selecting or booking a unit. It gives you assurance that you do indeed qualify for a loan, and ascertains the maximum loan you can get for so that you do not risk forfeiting any of your booking fee.


# For executive condominiums it may be possible to obtain 80% loan even if you currently have a housing loan. Please contact us if you would like to be put in touch with bankers specializing in executive condos who can assist and advise you on this.


Payment Schedule under Normal Payment Scheme

Payment terms and funding for an EC for those taking 80% (if currently no property loan) vs those taking 60% loan (if currently have outstanding loan). CLICK TO ENLARGE.




Payment Schedule under Deferred Payment Scheme
Payment terms for those taking 80% under Deferred Payment Scheme. An EC unit typically costs 2 to 3% more under this option.

It enables those who have an outstanding property loan to still take 80% bank loan for the new property purchase (subject to bank credit assessment & approval). CLICK TO ENLARGE.