Home ownership in Singapore is one full struggle when it comes to raising the money for the equity or down payment. Your home loan mortgage may be secured by a real property, but you need to pay for the cash portion of the down payment from your very own pocket or own source of funds. Let us put it this way. If your credit application qualifies for an 80% loan, then you need to find cash and raise the remaining 20%. In Singapore, you are to pay, out of your own funds, the difference between the purchase price of the residential property and the approved amount under any credit facility. How do you think you can achieve this?
Borrow from your company or employer
It is possible to borrow money from your company. Companies have the prerogative to help their staff and lend the money they need for the equity. Some corporation is generous enough to lend money to their staff without interest in a few months.
Borrow from your parents, friends, or relatives
Based on the new ruling, you should be careful in making more borrowings because it will impact your credit application with the bank especially the approved amount. At some point, you probably need money that you don't have handy. You can approach your parents, family, friends, or relatives who can draw out funds for you in a shorter term with little or no interest at all.
CPF savings
You can money lender near me look into your total CPF savings and pay the down payment. If it is not enough, then you need to consider paying the balance in cash. Replenish your balance later when you paid the amount you had withdrawn from your CPF savings. Buying a home is the biggest and could be the longest financial commitment you may have and should be carefully planned before the actual purchase takes place. Your anticipated approved amount of loan entirely depends on your income, existing debt obligations, available savings, and existing expenses.
What can you afford?
To work out your budget, you need to anticipate additional expenses such as property taxes, insurance, and some buffer for possible interest rate rises. These things you need to pay in cash because you cannot take this from your CPF savings. This includes meeting your other existing financial commitments such as your current monthly living expenses.
Cash savings
Get your cash savings handy. You need this to look up your upfront payments when you decide to buy your homes. Remember, the CPF savings can only be used for freehold or leasehold land. Once you reached the allowed withdrawal limit, you are unable to use the CPF savings and need to pay the remaining amount in cash. It is a taboo to tell a seller to wait, when you really want that home. Having an immediately accessible source of cash that is about three to six months of your gross income. Loan equity and the repayments take a large chunk of your savings and expected income. This is more relevant when you are out there renting a property while waiting for your new home to get ready. The thing is that you need to get ready of the cash flow issues.
Singapore is a country that has attained the status of one of the topmost wealthiest countries of the world. Its liberal financial policies also make it a country that offers higher return on investment to the people who invest in Singapore.
If a person has property, whether it is private home or an HDB (Housing Development Board) one, he stands with an opportunity of gaining loan money that he can invest in some business so as to earn a handsome living without selling his property or home.
If a person has already taken a mortgage type of home loan from a financial institution in Singapore and some years have passed, he can go for the mortgage refinancing. This refinancing has many benefits as it promises lower interest rate and lesser installment amount. The bottom-line of the matter is that the borrower has to pay less money in the long run.
Refinance option is helpful in many respects as it brings considerable relief to the home owner and the lender. It means a person goes towards the management and consolidation of his loans and contacts another bank or financial entity for the re-consideration of the interest rate as well as the monthly installment that he has to pay. It usually leads him towards lesser monthly installments and better planning of the finances on part of the borrower.
Different banks and financing institutions offer the refinance opportunities to people, and this leads the latter to use their extra money to invest in Singapore. This also brings a lot many financial advantages as it means the borrower has more monetary resources for investment and better loan management strategy.
Loan management and mortgage refinancing go side by side. A loan is better managed if borrower or loan receiver has to pay less as compared to the situation when he was paying more. Loan management depends on precise and accurate information. If a person has this information, or can hire professionals who have this knowledge, he will easily be able to get a lot of relaxation on his loan. This will also lead him to understand the true advantages of professional attitude towards his loans.
For the mortgage refinancing, loan recipient has to collect all documents and information about previous home loan. He must know about the previous loan that he has got from HDB or from some other bank like Citibank, Hong Leong Bank, DBS, HSBC, OCBC, Maybank, UOB, Standard Chartered, and so on. Each bank has different mortgage rates and policies; rules and regulations of one bank will not be the same for the other. So, it is advisable that the borrower should have the information about the rules and regulations of the current lender as well as the future one.
Mortgage refinance should lead a loan recipient towards having to pay lower interest rate as compared to the situation when he used to pay higher interest rate. Moreover, a refinance can be prolonged to more years than are remaining in the previous mortgage. This way, a loan that was to be paid in five years can be prolonged to more than five years if the client desires so. Hence the monthly installment amount will considerably fall, and the loan recipient will be able to use his savings to invest in Singapore.