Singapore: Staggered Downpayment Scheme

Among the many schemes developed by the Singaporean Government with the purpose of aiding first-timer couples buy their home early in life and be able to support a large family, is the SDS, otherwise known as the Staggered Downpayment Scheme. This is designed to basically allow would-be buyers to make the down payment in two tranches when taking out a bank loan.

For married couples or couples applying under the FiancĂ©/FinacĂ©e Scheme who are booking a 2-room, 3-room, 4-room or 5-room HDB flat that is under construction in any of the Housing and Development Board’s sales exercises, the down payment for the flat purchase can be made in two parts. In order to be eligible for the SDS, both partners of the couple must be first-time applicants and the flat application must be submitted on or before at least one of the partners’ 30th birthday.

If the buyer qualifies to take an HDB housing loan, he/she will pay a 10% down payment using either CPF savings, the CPF Housing Grant or cash, half of it at the time of signing the Agreement for Lease, and the other 5% upon collection of keys to the flat.

If the buyer applies for a housing loan taken from FIs (financial institutions, such as: banks), the down payment is as follows:

For bookings made between 14 Jan 2011 and 5 Oct 2012, if the applicants have no outstanding housing loans whatsoever, the down payment is 10 percent of the price of the residential property, with 5 percent of it payable in cash, and a balance of 5 percent payable either with Central Provident Fund savings, CPF Housing Grant or in cash upon signing of the Agreement for Lease. In addition to the first 10 percent is a balance of 10 percent down payment using CPF savings, CPF Housing Grant or cash, paid when collecting the keys to the flat. If, however, the applicants have no outstanding home loans, 10 percent of the total purchase price will be paid in cash after signing the Agreement for Lease, and a balance of 10 percent will be paid in cash or with CPF savings or CPF Housing Grant upon collection of keys.

For bookings made on or after 6 October 2012, applicants who qualify for a loan ceiling of 80% will pay 5% down payment in cash and a balance of 5% using either cash, Central Provident Fund savings or the CPF Housing Grant when signing the Agreement for Lease, and a balance of 10% down payment when collecting the keys. For those eligible for a loan ceiling of 40 percent or 60 percent, 10 percent of the purchase price will be paid in cash when signing the Agreement for Lease, and a balance 10% will be paid using CPF savings, CPF Housing Grant or cash when collecting the flat keys.



Source by Justin Ang

Ben Wills

I am a professional finance expert and business lover.

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