As Low as 3.5% Interest Rate (Fixed)
Loan Amount More Than S$500,000
- Singapore’s largest bank with a strong reputation for stability and trust.
- Offers both fixed and floating rate mortgage packages to suit various needs.
- Seamless online loan application and refinancing tools.
- Known for fast loan approvals and comprehensive customer support.
Interest Rates Starting from 3.98% (Floating)
Loan Amount More Than S$500,000
- Flexible loan structures ideal for both HDB and private property buyers.
- Provides Home Rates (OHR) pegged packages for transparent pricing.
- Option to use CPF savings for partial repayments or monthly instalments.
- Reputable for personalised service through dedicated home loan specialists.
New Home Loan Singapore: Your Complete Guide
Ready to buy your first home? Learn everything about securing a new home loan in Singapore, from loan types and requirements to tips on choosing the right package. Our comprehensive guide simplifies complex jargon and helps you make confident decisions.
Understanding New Home Loans
A new home loan is a mortgage designed for first‑time home buyers. Instead of paying the full purchase price upfront, you borrow from a bank or housing board and repay it gradually over a fixed period, usually ten to thirty years. This arrangement makes owning a property in Singapore more attainable because it spreads payments evenly while allowing you to use your Central Provident Fund (CPF) savings to offset monthly instalments.
Unlike refinancing, which replaces an existing mortgage, a new home loan applies to your first purchase of an HDB flat, condominium, or landed property. Choosing the right loan requires careful consideration of interest rates, repayment terms and eligibility criteria. In the sections below, we’ll explore why home loans are important, what options you have, and how to prepare yourself before applying.
Why New Home Loans Matter in Singapore
Property prices in Singapore are among the highest in Asia, making mortgages essential for most households. Without a loan, many would struggle to pay the full property cost upfront. A well‑structured mortgage spreads the financial burden, letting you build long‑term equity while maintaining day‑to‑day cash flow. Moreover, using CPF savings to service your mortgage lightens the load on your monthly salary.
It’s also important to understand the Total Debt Servicing Ratio (TDSR) framework. According to the Monetary Authority of Singapore, no more than 55 per cent of your gross monthly income can go towards repaying all your debts, including your mortgage. This rule exists to protect buyers from overcommitting financially and helps maintain overall economic stability. By keeping your debt obligations within this limit, you leave sufficient room for daily expenses and emergencies.
Types of New Home Loans in Singapore
There are two main categories of new home loans: HDB loans and bank loans. Each comes with its own interest rates, downpayment requirements and eligibility rules.
Comparing Loan Types
| Type of Loan | Provider | Interest Rate* | Downpayment |
|---|---|---|---|
| HDB Concessionary | HDB | 2.6% fixed | ≥10% (CPF/cash) |
| Bank Loan (Fixed) | DBS/OCBC/UOB | 1.3–1.8% | ≈25% (CPF/cash) |
| Bank Loan (Floating) | Private Banks | SORA + margin | ≈25% (CPF/cash) |
Key Benefits
HDB Concessionary
- Stable interest pegged to CPF rates.
- Lower minimum downpayment (can use CPF).
- Designed for first‑time HDB buyers.
Bank Loan (Fixed)
- Lower initial promotional rates.
- Predictable repayments during lock‑in period.
- Available for HDB and private properties.
Bank Loan (Floating)
- Rates track SORA, offering potential savings.
- Greater flexibility with shorter lock‑in periods.
- Ideal for borrowers comfortable with rate fluctuations.
*Interest rates are indicative and may vary. HDB concessionary loans are reserved for eligible citizens buying HDB flats. Bank loans apply to both public and private properties. Fixed packages lock your rate for a set period, while floating packages follow the Singapore Overnight Rate Average (SORA) and may change over time.
Eligibility and Requirements
To qualify for a new home loan, you must meet several conditions. Here is a high‑level overview:
Mortgage Eligibility Checklist
| Requirement | Details |
|---|---|
| Age | Must be at least 21 years old; loan term must end before you turn 65–75, depending on the lender. |
| Income | Stable monthly income meeting each bank’s minimum requirement; usually S$2,500 or more. |
| Credit Standing | Good credit score and payment history with no recent defaults. |
| Total Debt Servicing Ratio | Your total debt obligations cannot exceed 55 % of your gross monthly income. |
| Mortgage Servicing Ratio | For HDB flats and executive condominiums, your mortgage payments cannot exceed 30 % of your monthly income. |
| Loan‑to‑Value Limit | First‑time buyers may borrow up to 75 % of the property value; more if using an HDB loan. |
| Documentation | Provide payslips, CPF contribution statements, tax forms and proof of other income. |
| Property Type | Property must be a residential unit approved by the relevant authorities. |
Meeting these conditions doesn’t guarantee approval, but it increases your chances of securing favourable terms. Banks and HDB will assess your income, debt obligations and credit history to determine whether you can service the loan comfortably.
Factors to Consider Before Applying
Beyond eligibility, several other factors should influence your choice of mortgage. Here are the most important considerations:
- Interest Rate Type: Decide between fixed and floating rates. Fixed packages offer stability, while floating packages may save you money when rates drop.
- Loan Tenure: A longer tenure reduces monthly repayments but increases total interest paid. Choose a tenure that balances affordability and cost.
- Lock‑in Period: Some bank loans come with a lock‑in period during which penalties apply if you refinance or redeem early. Check the terms carefully.
- Fees and Charges: Consider legal fees, valuation costs, processing fees and potential penalties for late or early payment. These can add up significantly.
- Ability to Use CPF: Find out how much of your CPF Ordinary Account you can use to pay the downpayment and service monthly instalments.
- Risk Tolerance: Floating rates might save you money when rates fall, but they can rise unexpectedly. Understand your comfort level before committing.
Comparing multiple packages from various banks is essential. Even a small difference in interest rate, such as 0.5 percentage points, can translate into savings of tens of thousands over the life of your loan.
How to Apply for a New Home Loan
The application process is straightforward but requires preparation. Follow these steps:
- Assess Your Budget: Use online calculators to determine how much you can borrow based on your income, debts and the TDSR limit.
- Check Your Credit Report: Obtain a copy of your credit score from the Credit Bureau Singapore and resolve any outstanding issues.
- Gather Documentation: Prepare your payslips, CPF statements, tax records and any additional income documentation.
- Get an In‑Principle Approval (IPA): An IPA from a bank indicates how much you can borrow and is valid for up to six months. It’s often required when placing a booking fee.
- Compare Packages: Speak to multiple lenders or engage a mortgage broker to compare rates and features. Ask about promotional perks like cash rebates or legal fee subsidies.
- Submit Your Application: Once you’ve chosen a package, complete the application and wait for approval. After approval, review the Letter of Offer and sign the loan documents.
Throughout the process, it helps to work with experienced professionals. Singapore Home Services can connect you with trusted banks and guide you through every step.
Banks Offering Competitive New Home Loans
Most major banks in Singapore offer a variety of mortgage packages tailored to different needs. Here are some of the key players and what makes them stand out:
DBS Bank
Singapore’s largest bank, known for competitive fixed and floating SORA rates and seamless digital application tools.
OCBC Bank
Offers flexible packages pegged to the OCBC Home Rate (OHR) with options for partial repayment via CPF.
UOB Bank
Provides attractive promotional rates and bridging loans to help with downpayment timing during property transitions.
Maybank
Ideal for cross‑border buyers; features competitive SORA packages and customer‑focused service.
HSBC
Popular among expatriates; offers premier mortgage packages with multi‑currency repayment options.
Standard Chartered
Offers SORA‑based loans with promotional cashback for refinancing and flexible tenures.
Other banks, such as CIMB, Citibank, Trust Bank and Bank of China, also have unique offerings. Each lender may run short‑term promotions or cash rebates, so staying updated is essential. A mortgage broker can help you navigate these options and select the best package for your situation.
Why Choose Singapore Home Services?
Our mission is to make your property journey smoother and more enjoyable. Here’s why countless homeowners trust us:
- Unmatched Speed and Reliability: We act swiftly and ensure dependable service, so your loan process stays on track.
- Expert Guidance Every Step: Our specialists understand the local mortgage landscape and tailor solutions to your needs.
- Seamless, Stress‑Free Service: From document collection to approval, we minimise hassle and keep you informed.
- Trusted by Local Families: Many Singapore households rely on our integrity and proven results.
- Smart Solutions, Real Savings: We compare packages across banks and uncover opportunities to save.
- Quality You Can Count On: Our commitment to excellence means we deliver on our promises every time.