Different types of Home Loan in Singapore

Home loans in Singapore are a type of mortgage used to buy residential property. It is also taken to buy plots, flats, and bungalows. There are various types of home loans that an individual can choose between while purchasing a house in Singapore. These types of loans are available in different interest rates, repayment periods, and amounts.

Types of Home Loan in Singapore

A) Conventional Home Loan:

This type of loan is used to buy a house, either for personal usage or investment. The home loans in Singapore under this category are given over at least 20 years of tenure. This type of loan has an Interest Rate linked to the bank’s Base Rate.

B)HDB Loan:

HDB (Housing and Development Board) gives these types of loans to buy a flat. The tenure of this home loan is 30 years, and the interest rates vary depending on the market condition. This type of home loan can purchase any unit from HDB or resale flats.It can also buy a unit under an executive condominium or private housing.

C) Fiance / Spouse Loan:

This is given financial assistance to the applicant’s spouse to buy a flat. This type of home loan can also purchase an Executive Condominium (EC) or private housing unit under the CPF Housing Scheme. To qualify for this loan, both individuals must meet specific income criteria and code of conduct.

D) Personal Loan:

Individuals who do not own any property can use this type of loan when applying for a home loan. Home loan is also used by those buyers who only want to buy either an HDB flat or EC/ private housing unit, which are below $350,000. This type of loan may be given with or without HDB Loan eligibility.

E) Cash-over-valuation (COV):

This type of home loan is given to the applicant to finance additional costs associated with purchasing a house, such as renovation charges, legal fees, stamp duty, etc. This type of home loan has an Interest Rate that varies following the bank’s Base Rate.

F) Cornerstone Loan:

It is given to Singapore citizens buying an EC or private housing unit under the CPF Housing Scheme. The tenure of this home loan is 25 years, and it has a fixed Interest Rate, which does not change throughout repayment.

These types of home loans have different repayment periods depending on each type of home loan. These loans are usually given by the banks, finance companies, and mortgagee companies in Singapore. The interest rates for a home loan may vary between lenders, and it is advised to compare the interest rates before taking up a particular type of home loan. It is also advisable to check if the home loan is under any housing schemes as they offer discounts and other benefits.

Bottom line:

In conclusion, home loans in Singapore are taken by the buyers to purchase their dream house. Depending on each loan type, these types of home loans are offered at various interest rates, tenure periods, and repayment amounts. They also come with specific terms and conditions to be fulfilled by the individual while taking up a loan.