How Mortgaging Works in Singapore

There’s not much difference between mortgaging in Singapore and anywhere else in the world. Nevertheless, little ideas wouldn’t hurt.

Before you apply for private home loan, make sure you can make a thorough research. How much does a property cost in Singapore? Plenty of homes and apartment or condo dwellings are expensive, but it may not be if you’re an expat. You also have to decide where you’re going to borrow your cash.

There are several lenders operating in Singapore, but not all of them are trustworthy. Stay away from those that ask for any kind of payment even when you’re just requesting for a quote. You should only pay when your application is approved. By then, you need to shoulder the financing costs and down payment.

Speaking of down payment, some countries like the United States would opt for a 20 percent down payment from the total purchase price of the property. In Singapore, it can vary. Some lenders would be okay with 10 percent, while the others demand for as much as 95 percent down payment. You will already have excellent private home loan deals such as lower interest rates if your down payment is between 25 and 40 percent.


Requirements can also depend from one lender to another. Usually, you will have more limitations if you’re a non-resident foreigner. For example, you cannot borrow more than 1 million SGD. It’s also important you can present a good credit rating. Reports are available normally for free depending on which country you’re from. Lenders base their rejection and approval of applications, as well as interest rates, on credit risks.

There are a number of loans you can apply, but there can be two general types. You have the loan for purchase of property. This means it’s your first time to obtain the home or condo unit. The second one is a loan for refinancing, which you can apply such as when you want to reduce your existing interest rate.

Lenders can present various marketing strategies to lure you to apply loans with them. Watch out for very low interest rates as there may be hidden costs or the finance charges are very high.  

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