HDB Downpayments for First Time Owners


Are you thinking of buying your own property in Singapore? Worried and confused about the fees and costs involved in this whole process?  Although taking this next big step can be quite intimidating to some, this article will act as a guide for first time home buyers. Buying your very first property such as a house is a part and parcel of growing up after all.

What should I be aware of?

While there are plenty of options that Singapore can offer, be sure to weigh off all the options first prior to making a decision. Think of what kind of house you can afford as it will most likely have an imminent impact on your financial savings.

Check the suggestive valuation for the house that you want to buy where you can then get a bank loan for the home you want. You can opt for a public housing loan or HDB bank loan downpayment to put down for your dream condominium, private residential housing or landed property. 

Valuation without delay affects the quantity of loan you could get for the house. Do take into consideration the loan period, month-to-month installment, as well as other housing costs that can burn a hole in your pocket if you do not plan carefully. 

On a side note, it’s vital to suppose a long time period and expect your actions within the future. If you need to buy a house for investment, you might want to consider prime districts like the Central Business District as the safest option. Properties with a view on the East Coast are also remarkable for a resort home.

A man thinking

How much should you realistically have before you buy?

Now, after you have weighed off all the pros and cons as well as the probable impact it could have to your savings, don’t forget to thoroughly check your savings!

Bear in mind that the cost of properties differs significantly based on various factors like location, facilities, surrounding amenities (e.g. MRT station), and the unit’s age or condition. As such, the price of a house may vary according to different neighborhoods. So, how much do you need to invest in an HDB flat?

You may think that hundreds of thousands are a huge amount of money to fork out for buying a house. But this is only because you view this amount in a lump sum! The fact is, there are different elements in paying for the unit which are:

  • Downpayment (10%)
  • CPF Housing Grants ( $160k!)
  • Monthly installments (the amount left to be paid for the HDB flat)

Hence, be prepared to have this sum of money when considering to buy an HDB unit. Moreover, you are also expected to pay a sum of money in cash.

  •  Administration Fee
    The allocations that you should be prepared with are $10 administrative fee to be paid by credit card when you buy a flat from HDB.
  • DBSS and EC applications Fee
    If you are applying for DBSS and EC applications, you can inquire about the amount needed to be submitted along with the application from the developers.
  • Option Fee
    Next, you should also have some savings to pay for the option fee which is typically $1,000 for a resale flat, $500 for 2-room flexi flats for BTO, $1,000 for 3-room flats, and around $2,000 for 4 room or larger flats. 

If you are overwhelmed and still confused about how much money you need to have to buy a house, there are also useful tools that can be of great help! HDB offers e-services that can help you to figure out the best financial plan when buying an HDB flat.

The Enquiry on Loan Estimate e-service will give you an estimation of the loan amount you can get should you take up an HDB loan. With everything at your fingertips, all you have to do is to fill in the details on the site such as monthly salary, employment record, HDB loan eligibility and also existing financial commitments. 

From there, the e-service will provide you with an estimated loan amount, estimated monthly installment based on the current interest rate, and also a 25 years repayment period. Thus, you can work out your financial plans more comprehensively in your pursuit to buy a house. 

Calculator and wooden house model

How much HDB downpayment should a first time home buyer pay?

If you are taking an HDB loan, the downpayment would be 10% of the purchase price of the house that you want to purchase. You can pay this using CPF Ordinary Account savings but if you do not have enough balance, you should pay the downpayment in cash. 

When you are currently into retirement planning Singapore, you can reserve your retirement money when you need it most: when you’re finally going to hang the towel of your professional life.

If you’ve heard an HDB owner mention that they’ve spent about $S40,000-S$50,000 just right after their downpayment, they’re telling the truth. That price can get higher, especially if you’re gunning for higher-priced HDB flats with multiple rooms and beautiful views.

An HDB flat costs about S$300,000-S$400,000 on average. Premium HDB units can go around S$500,000-S$600,000. Most downpayments require you to provide at least 10% of the entire financing. However, that’s not the only thing you’ll need to accomplish. Here are other expenses that you’ll need to address in the process.

  • Booking Fee: This amount is known as the option fee as well. When you book the flat, you need to pay S$2,000 to reserve the HDB unit away from others looking to buy it. It reimburses and helps complete your downpayment.
  • Application Fee: For representatives to process your HDB downpayment and flat application, you’ll need to pay this compulsory fee.
  • Downpayment: Often 10% of the total property value. If the property is S$300,000 in total, you’ll need to pay S$30,000 as downpayment. This rate might be higher if you’re working with banks instead of HDB’s in-house loan service.
  • Stamp Duty and Legal Fees: If HDB acts on your behalf to process your purchase, you’ll need to pay S$30-S$40. You can calculate the stamp duty for Agreement Lease using the Stamp Duty Calculator provided at the Inland Revenue Authority of Singapore website.Close-up of hands protecting small house model
  • Fire and Disaster Insurance: The local government requires all tenants and property owners to own a fire and disaster insurance policy. A fire insurance is the minimum. The fee would be $4.50 for five years for a 3-room BTO flat.
  • Conveyance and Caveat Registration fees: These are the among legal fees charged by the legal services to process the paperwork for property ownership ranging from S$200-300 and S$60 respectively.

Loan Agency

What are the sorts of financing that you can look into to get it?

So now, you might start looking into financing that you can get to aid you in buying an HDB flat. These are the different financings that you can opt for.

HDB Housing Loan from Governments

The government subsidizes HDB flat payments if you qualify for its financial assistance program. You’ll just need to handle a 2.60% interest rate per annum. While banks might offer modest terms, HDB housing loans are less strict. You can use them as long as you can pay the 10% downpayment for the purchase price as soon as possible.

HDB Housing Loan from Banks

Alternatively, you can choose to use banks to finance your HDB flat downpayment and recurring repayments. Banks are a popular alternative, but only if you have excellent credit scores. Most Singaporeans fail to secure their bank financing because of their problematic credit. But if you can fulfill their requirements and have good fiscal standing, they’re a good option to obtain your housing loan.

Alternative Loans: Moneylender HDB Loan

365 Credit provides HDB flat buyers enough to pay for their downpayment. We can also provide bridging loans if you are in the midst of selling your property and wanted to buy a new property. We address a huge chunk of repayments for your new HDB flat in the process. Furthermore, we do not require credit scores and performance unlike banks. If you want to work with us, you just need the following requirements:

  • Identity card/NRIC
  • Utility bills, letters addressed, credit card statements, anything that proves you live in your address
  • Proof of employment
  • Proof of Income
  • SingPass details

Furthermore, Singapore’s Housing Development Board has its in-house financing service you can use to finance your house. However, it has certain (but not stringent) criteria that buyers need to fulfill. In addition, only Singaporeans can use HDB loan services. 

Alternatively, you can use a bank loan for HDB properties in-house. On the other hand, banks and moneylenders offer housing loans. Any homeowner who does not qualify for an in-house loan service can use banks and best licensed money lender to finance their new home.

What other costs are there?

After all these talks revolving downpayment and financings, do note that there other costs needed to purchase a house. 

Legal fees:

The paperwork for property ownership are processed by legal services. As such, they will charge you with legal fees such as the Stamp duty for Agreement for Leas, Conveyancing fees, and Caveat registration fee.

Conveyancing fees for new HDB flats can be calculated as follows:

  • First $30,000 of property value: $0.90 per $1,000
  • Next $30,000 of property value: $0.72 per $1,000
  • Remaining Amount: $0.60 per $1,000

So if a 3-room BTO flat  has a price of $180,000, the conveyancing fee would be $121.

worker with white gloves replacing gray tiles

Maintenance fees:

You will have to pay conservancy charges made by HDB estates which generally range from $20 to $90 per month for Singapore citizens (reduced rates). On the other hand, non-citizens pay a normal rate, which is notably higher than the reduced rates. 

Check out the rates with the town council of your area to be certain of the precise amount.  Hence, a 3-room BTO flat would have conservancy charges of $45 per month.

Property taxes:

Essentially, the Annual Value (AV) of your house would determine the property taxes. AV here is the annual amount that you benefit from renting out your property. You can check with the Inland Revenue Authority of Singapore to find out the amount needed to be paid.

As such, if a three-room flat has an AV of $14,400, the property tax would be around $512 per annum.


If you intend on doing your first big purchase, you need to be sure that you are both mentally and financially prepared. Hence, if you have done adequate research on this subject matter, things will only be smooth sailing from here. 

Research the area where you want to buy a house, the type of house that you want and what fits your budget. Licensed money lender such as 365 Credit Solutions can provide you with a lot of options when you decide to buy your first HDB property or condominiums and other private Singapore properties. Check out our website to find out more.

Applying For Your HDB Loan Eligibility (HLE) Letter

Planning to buy a house is already a struggle; let alone actually buying it. It is very important that one has a strategic plan to make the purchase of an asset. If you are looking out to apply for an HDB Housing Loan, you will need to attain your HDB Loan Eligibility (HLE) letter, a crucial document for reference that could help you go through the process because “no letter, no loan” basically.

How to get it, you ask? Keep on reading.

#1 What is an HDB HLE Letter

First and foremost, the HDB HLE letter is a document that states the necessary reference for HDB to know one’s financial standing and condition before lending the fund to buy the HDB flat. The HLE letter will supply you with the mandatory information that you need to get ownership of a flat or helps you in setting up a personal budget. Also, it could function as a financial planning apparatus.

Listed below are the particulars that are provided in the letter:

  • Eligible loan amount
  • Monthly installments
  • Repayment period
  • Amount of cash proceeds from the disposal of your existing or previous flat to be used to pay for the next flat (if applying for second HDB concessionary housing loan)
  • Other terms and conditions

The validation of this letter may last up to 6 months and the HLE letter may need up to 3 weeks to get to you starting from the date it was issued. Furthermore, re-assessment is not required within this period so long as there is no alteration in financial position and family members. Moreover, you may apply for a new HLE letter once the existing one is a week away from its expiration.

Loan Application papers

#2 Eligibility to Make an Application

In order to be eligible to apply for HDB Housing Loan, and thus be eligible for an HLE application, one must fulfill these criteria listed.

CitizenshipAt least one buyer has Singapore citizenship
Household Status• Have not gotten 2 or more housing loans from HDB
• Have gotten 1 housing loan from HDB and the latest owned asset is not a private housing property (local or overseas) such as:
o HUDC flat
o Gifted property
o Inherited property as a beneficiary of a will or through Intestate Succession Act
o Property owned through a nominee
Income CeilingAverage gross monthly household income is not more than:
• $14,000 and above for families
• $21,000 and above for extended families
• $7,000 and above for singles buying a 5-room or smaller resale flat or a 2-room new flat in a non-mature estate, under the Single Singapore Citizen (SSC) Scheme
If an applicant has been unemployed for under 3 months, his/her average gross monthly income will be valued based on the number of months worked.
Ownership/ Interest in Property1. Cannot own or sell any private housing property in the last 30 months prior to the date of application of an HLE letter.
2. Must not own or have disposed of any private residential property in the 30 months before the date of application for an HDB Loan Eligibility (HLE) letter. A private residential property (local or overseas) will include:
o Gifted property
o Inherited property as a beneficiary of a will or through Intestate Succession Act
o Property owned through a nominee
3. Not an owner of more than 1 market or any industrial property
4. If any 1 market or any industrial property is owned, one should have no other sources of income
Remaining Lease• The loan amount depends on the longevity the remaining lease able to cover from one’s youngest age to 95 years old.
• You can use these online calculators to plan your budget:
o Resale Financial Plan
o Sales Financial Plan

Home key

#3 3 Types of Loans: LTV, MSR, TDSR

Loan-to-value limit (LTV limit)

LTV limit is the maximum percentage of one’s property worth value you are permissible to pay with loan funding. Generally speaking, it could be equal to 90% of property value inasmuch as the remaining lease of the assets you wish to buy is sufficient for you to depend on until 95 years old. If you are going to apply for a BTO flat, your LTV limit will most definitely equate to the 90% of property value. This is because a BTO flat comes together with a 99-year lease.

Mortgage servicing ratio (MSR)

For MSR, an applicant is only allowed to pay off the 25-years HDB loan with up to 30% of income. You can ask advice from a mortgage broker for a guide with regards to MSR.

Total Debt Servicing Ratio (TDSR)

The rule-of-thumb with TDSR is that, if you are free from any debts, this will not be applicable to you and your application. By right, not any more than 60% of your monthly income should be set aside in paying off debts. This includes most (if not all) an ordinary Singaporean commitment such as; housing loan, car loan, credit card instalment even.

Hence, if let say you are earning a fixed income of $5000 per month, your TDSR will be:

60% of %5000 = $3000

From the amount of your TDSR, if you are already committed to paying off debts up to $1200 monthly, this brings to $1800 left. Meaning to say, you are only eligible to apply for an HDB loan with a maximum of $1800 repayment per month. If we were to assume you are taking the HDB loan for its full term 25 years long tenure, the maximum amount you will be able to borrow is:

$1800 x 12 months x 25 years = $540,000

Bear in mind, similar to the MSR, only 70% of your variable income will be included towards the TDSR.

Happy family

#4 Now… How do I apply for the Letter?

Now, your HLE letter application will start logging onto the HDB website. In the process, you will be required to fill in your necessary particulars along with the needed documents. This may include your payslip in order to prove your income or a record of your CPF contribution history.

When you want to apply for your HLE letter, do it at the right time. Overall, the complete application may take a span of time of 2 weeks, for this reason, it is best and highly recommended for you to apply it in advance before you decide to reach a verdict for your dream HDB flat.

Next, when your application has finished, went through and succeeded (hopefully), you may have a look and retrieve your own copy of the HLE letter from this link. If you wish to keep track of your application process, you may do so on the same platform.

Loan application folder

#5 What Documents Should I Prepare When Applying?

For the inquiry, below are the documents you are expected to present when making your application for HLE letter:

Before that – one thing to be noted, before settling HDB downpayment it will require different types of documents with people from different backgrounds and commitments. Therefore, to make it easier, just get this – the lower your income is, the more documents will be needed by HDB to approve your loan.

For applicants who are an employee with CPF contributions:

  • Latest three months’ payslips
  • 15-month CPF history

For applicants who are an employee without CPF contributions

  • Latest 12 months’ payslips
  • Latest 12 months’ bank statements
  • Credit Bureau report

For applicants who are self-Employed

  • A valid Accounting and Corporate Regulatory Authority (ACRA) Business Profile computer or a valid license of business/trade
  • Latest notice of assessment from the IRAS or a Certified Annual Statement of Accounts from an audit firm

For applicants who are commission-based and part-time workers

  • The Commission statements and payslips for the last 12 months
  • Latest 15 months’ CPF history
  • Credit Bureau report
  • Latest 12 months’ bank statements

For odd job workers

  • Latest Notice of Assessment from the IRAS or a recent letter from the employer certifying your job designation, commencement date, and your commission/salaries for the last 12 months
  • Latest 15 months’ CPF history
  • Credit Bureau report
  • Latest 12 months’ bank statements

For applicants who are a pensioner

  • Latest 3 months’ payslips or a recent letter from the previous employer stating the monthly pension received for the last 3 months
  • Credit Bureau report
  • Latest 12 months’ bank statements

For applicants who are

  • If you have been unemployed for under 3 months, you are to prepare the previous pay slip of your gross monthly income from the months you were still working and state the last day of your service with the last 15 months’ CPF history
  • If you have been unemployed for more than 3 months, you are required to submit a Statutory Declaration, which is attainable through the HBD hub loan counter or from any HDB branch

With that said, below are the important reminders for you. Be VERY sure to apply your HLE letter as early as you can, this because, it is very much needed when you:

  • Reserve a new flat from HDB
  • Wants to purchase from a resale flat seller
  • Applies to take over the ownership of a flat (by way of transfer)

Important to note, there will be no mortgage loan financing for an applicant who wishes to buy a 2-room Flexi flat on a short lease coverage. This is because you will have to go to the place with your own cash or CPF savings. To add to that, couples who fulfill the criteria of applicants and are applying for the first time – those who are both full-time students or National Servicemen, or completed their studies or National Service in the last 12 months before their application, they may be exempted from any income assessment by HDB until just before key collection.

Loan Papers

#6 If I have Gotten My Letter, What’s Next?

Firstly be reminded that if you are to apply for an HDB flat without the letter, or a letter that is validated, you will not be eligible to apply for an HDB housing loan in the future. Secondly, as said earlier on, your HLE letter has a lifespan of 6 months before it expires from the issuance date.

Now, how are you going to put your letter in use? This is how:

  • When you buy an HDB flat
  • When you resell an HDB flat

Specifically, your HLE letter will be much needed when you book your BTO flat. Also, within the period, you will also need to settle your down payment and other miscellaneous fees. Your down payment cost is usually more or less of 10% of the overall purchase price.

Going forward, when you can finally collect your keys – which may take about 2 years (or more), your existing HLE letter may be expired. Of course, you will have a validated one – hence, be alerted of when your first letter expires and apply for a new one when the time comes. Be sure that by then, you are still financially stable and meet the criteria.

The loan funded to you is repayable by cash or through your CPF account. The important details you will be aware of are:

  • Total loan amount
  •  Amount of monthly repayment
  • Period of tenure
  • Interest rate

By now, we would assume you are quite ready to apply for your urgent loan Singapore and grab your dream house! As hassling as all of this process may be, it is just as essential as getting the home you dream of owning. With no further ado, you can now go house-hunt! We wish you the very best of luck with it!

If you enjoy your read, don’t forget to share the article on your other platforms. With all that said, if you are in any circumstances needing immediate cash or financial help, you may visit 365 Credit website – one of the most trustworthy moneylenders in Singapore.