If you are buying a home in Singapore in 2026, whether an HDB flat or a private property, the first mortgage decision is who lends you the money: HDB or a bank. Your choice of housing loan shapes the rate, the downpayment and the risk. HDB's concessionary loan is fixed at 2.6% per annum, the rate it has held for over 20 years. Bank packages have fallen hard this cycle, with the cheapest fixed rates near 1.4% and floating rates around 1.2% to 1.3% as of mid-2026. For most HDB flat buyers, a bank loan now costs noticeably less per month, but the HDB loan still wins on flexibility, downpayment and risk. Whichever you pick, you can borrow at most 75% of the price, you need a 25% downpayment, and your loan size is boxed in by two government caps (TDSR and, for HDB or EC, MSR). This guide walks the whole thing in order so you can work out what you can borrow, what it costs, and which loan fits.
There are two kinds of home loan in Singapore. The HDB concessionary loan comes from HDB and is only for buying an HDB flat. Bank loans come from the banks and can fund any property, HDB or private. You cannot take an HDB loan on a private home.
In 2026 the trade-off is unusually clear on price. The HDB loan is 2.6% per annum, while the cheapest bank fixed rates sit near 1.4% and floating packages around 1.2% to 1.3%. On a $400,000 loan over 25 years, that gap is roughly $230 a month. The catch is that bank rates move: they are fixed for one to three years, then reprice. The HDB rate has not changed since 1999.
Two numbers decide your loan size: the LTV ceiling and the debt-ratio caps. Your loan is the lower of the two.
Loan-to-Value (LTV) is the share of the price the lender will finance. For a first housing loan taken over the standard tenure, the LTV limit is 75% for both HDB and bank loans. HDB cut its own LTV from 80% to 75% on 20 August 2024, so the two are now aligned. The remaining 25% is your downpayment.
The LTV drops to 55% on a first housing loan if your loan tenure runs past age 65 or the tenure is longer than the cap (more than 25 years for HDB flats, more than 30 years for private). It drops further if you already have a housing loan outstanding: MAS caps the LTV at 45% for a second housing loan (25% if the tenure also exceeds the limits) and 35% for a third or later loan. A lower LTV means a much bigger downpayment, so the number of existing loans, tenure and age all matter for affordability, not just monthly cash flow. Confirm the tier that applies to you on MAS before committing.
Even if the LTV allows a large loan, your income has to support it. The Total Debt Servicing Ratio caps all your monthly debt repayments, home loan plus car loan, personal loans, credit card minimums and so on, at 55% of your gross monthly income. This applies to every property loan.
On top of that, HDB flats and new executive condominiums bought from a developer face the Mortgage Servicing Ratio: the home loan repayment alone cannot exceed 30% of gross monthly income. Private condos, walk-ups and landed homes are not subject to MSR, only TDSR.
Here is the part that trips people up. When a bank works out your maximum loan, it does not use the 1.4% you will actually pay. MAS requires lenders to stress-test the loan at a medium-term interest rate floor of 4% per annum for residential property. So the bank checks that your repayment at 4% still fits inside the 55% TDSR and 30% MSR limits, even though your real outlay is far lower. Cheap rates do not let you borrow more; the 4% floor sets the ceiling.
Tenure is the number of years you take to repay, and it is capped two ways. There is a hard ceiling by property and lender (25 years on an HDB loan, 30 years on a bank loan for an HDB flat, 35 years on a bank loan for private property), and there is an age rule. The age rule is the one buyers miss: for the full LTV your loan must finish by age 65. A bank applies the lower of the property cap or the years left until the youngest borrower turns 65, and for joint borrowers it uses the income-weighted average age, which can pull the workable tenure down.
Stretch the tenure past age 65 and you can still get the loan, but the LTV drops from 75% to 55%, so the downpayment jumps from 25% to 45%. That is why a 40-year-old buying alone usually caps tenure at 25 years rather than reaching for 30: the extra five years would push repayment past 65 and trigger the bigger downpayment. A longer tenure also means more total interest even at the same rate. Model the trade-off between monthly repayment and total interest with the mortgage calculator before fixing the term.
Work out your financing before you sign anything. Singapore has two pre-approval routes, one for each lender, and both exist so you do not put money down on a flat you cannot finance.
For an HDB loan, the HDB Flat Eligibility (HFE) letter is the gate. It confirms whether you qualify for the concessionary loan, the loan amount, and any CPF housing grants, and you need it in hand before you book a new flat or grant an Option to Purchase on a resale one. For a bank loan, the bank's equivalent is an Approval-in-Principle (AIP), sometimes called In-Principle Approval. It is a non-binding indication of how much the bank will lend based on your income and existing debts, usually valid for around 30 days. Get the AIP first so you know your real budget before you commit cash.
One number the AIP makes concrete is valuation. A bank applies the 75% LTV to the lower of the purchase price or the bank's own valuation, not whichever is higher. If you agree to pay $620,000 for a flat the bank values at $600,000, your loan is capped at 75% of $600,000, and the $20,000 gap (cash-over-valuation) comes out of your pocket on top of the downpayment. On a resale flat you only get the official HDB valuation after you have the Option to Purchase, so the AIP plus a realistic valuation view stops you overpaying.
Banks also set a minimum loan size, commonly around $100,000, so a small top-up loan on a cheap flat may not be worth a bank's fees. Use the BTO affordability calculator to pressure-test the price before you start viewing.
Most cash-flow shocks come from doing these steps out of sequence, usually committing to a flat before the financing is locked. Run them in this order so you never put money on a property you cannot fund.
Foreigners and PRs follow the same bank route but cannot take an HDB loan; that path is HFE-only for buyers who qualify. A bank loan is open to Singaporeans, PRs, and foreigners alike, subject to income, age (most banks lend from 21) and the same 75% LTV and TDSR rules.
If you are buying an HDB flat and qualify for both, this is the core decision. The numbers below are the current 2026 figures.
The HDB loan rate is pegged at 0.1 percentage point above the CPF Ordinary Account rate and reviewed every January, April, July and October. Since the CPF OA rate is at its legislated floor of 2.5%, the HDB rate stays at 2.6%. It will not move unless the OA floor changes. Bank rates, by contrast, track SORA plus a spread or are locked for a fixed period, then revert to a floating rate.
| Feature | HDB loan | Bank loan |
|---|---|---|
| Interest rate | 2.6% p.a. (CPF OA + 0.1%) | ~1.2% to 1.9% (fixed or SORA-based) |
| Max LTV (first loan) | 75% | 75% |
| Min cash downpayment | 0% (can be fully CPF) | 5% of price |
| Max tenure | 25 years | Up to 30 years on HDB flats |
| Lock-in period | None | Usually 1 to 3 years |
| Early repayment penalty | None | Often ~1.5% during lock-in |
| Income ceiling | $14,000/month (families) | None |
| Can switch later | Yes, to a bank loan (one-way) | Cannot switch to an HDB loan |
The HDB loan has rules a bank loan does not. To get one you need at least one Singapore Citizen buyer, a household income at or below the ceiling ($14,000 for families, $7,000 for singles, $21,000 for extended families), and you must not own or have an interest in any private residential property, here or overseas, nor have disposed of one in the 30 months before applying. You also get at most two HDB concessionary loans in your lifetime.
Two further conditions catch people out. The flat must have enough lease left to cover the youngest buyer to age 95, or HDB scales back the loan and the CPF you can use. And HDB runs its own credit assessment: if your repayment history is weak, it can reduce the income it counts towards your loan by up to 30%, which shrinks the amount you can borrow even when your salary is fine on paper. Clear or reduce other debts before applying if your credit record is patchy.
Eligibility is confirmed through the HFE letter, which you need before you buy. Our HFE letter guide covers how to get it and how long it takes.
Take the bank loan if you want the lowest rate today and you can stomach repricing every few years. The monthly saving versus 2.6% is real. The risk is that when the package reverts, rates could be higher; you then refinance to stay competitive.
Take the HDB loan if you value certainty, want to preserve cash, or your income or savings are tight. The downpayment can be paid entirely from CPF, there is no lock-in, and you can repay early or sell anytime without a penalty. You can also refinance an HDB loan to a bank later if rates stay low. The one-way door matters: once you move to a bank, you can never switch back to the HDB loan. See our side-by-side in HDB loan vs bank loan.
If you go with a bank, the next choice is the rate type. A fixed-rate package locks your rate for one, two or three years, then reverts to a floating rate. A floating package is pegged to a benchmark, almost always the 1-month or 3-month SORA, plus a fixed spread, and it moves with the market.
In 2026 the gap between fixed and floating is small, often under 0.2 percentage points, because rates have already fallen. That changes the maths. When fixed and floating are close, floating lets you ride any further rate cuts, while fixed buys peace of mind if you think rates have bottomed. There is no universally right answer; it depends on your view and how much repricing stress you can take.
Whichever you choose, review the loan when the lock-in ends. Banks reserve their sharpest rates for new customers, so the reverting rate on your old package is usually higher than what is on offer elsewhere. Refinancing or repricing every two to three years is normal here.
A lower headline rate is only worth chasing if the saving beats the cost of moving. Refinancing to a new bank means a fresh legal conveyancing fee, usually a few thousand dollars, and a valuation fee on the property. Many banks offer a legal-fee subsidy or cash rebate to win your business, but it often comes with a clawback: leave that bank inside a set period (commonly three years) and you repay the subsidy. Repricing, which is moving to a new package inside your existing bank, skips most of the legal work and the conversion fee is typically small or waived, which is why it is often the cheaper switch even if the rate is fractionally higher.
Two timing rules matter. First, never refinance during your lock-in unless the saving clearly clears the penalty, which is around 1.5% of the outstanding loan. Second, give notice early: most loans need three months' redemption notice, so start shopping about four to five months before your lock-in ends. Run the gap between your reverting rate and the best refinancing offer against these costs before you move; on a small remaining balance the fees can swallow the saving.
The 25% downpayment is not one lump sum, and how much must be cash depends on the loan. This is where many buyers underestimate what they need on hand.
On an HDB loan, the full 25% can come from your CPF Ordinary Account if you have enough in there, with no minimum cash component. With an HDB loan you can keep up to $20,000 in your OA as a buffer, and the rest of the balance goes toward the loan. With a bank loan the OA rule is looser: you may retain any amount you like in your OA and use the rest for the purchase, so a bank-loan buyer can hold back more CPF for emergencies if they prefer. CPF still recommends keeping at least $20,000 set aside either way. On a bank loan, at least 5% of the price must be paid in cash; the other 20% can be cash or CPF OA.
So on a $600,000 resale flat, the bank-loan buyer needs at least $30,000 in cash plus another $120,000 from cash or CPF. The HDB-loan buyer can cover all $150,000 from CPF if the OA balance is there. Run your numbers with the HDB loan calculator and the mortgage calculator first.
Buyers fixate on the downpayment and forget the smaller costs that all land in the same few months. Some must be paid in cash, some can be paid from CPF, and none of them can be borrowed inside the home loan. Add them up before you decide what you can afford.
On a resale flat the option fee comes first, paid when you receive the Option to Purchase, which is then valid for 21 calendar days for you to exercise. Then the rest of the downpayment, the stamp duty, and the legal and valuation fees follow at completion. On a new BTO flat these are staggered across the build, which is easier on cash flow.
| Cost | Cash or CPF | Notes |
|---|---|---|
| Option fee (resale) | Cash | Paid on receiving the OTP; OTP is valid 21 calendar days |
| Downpayment (25% on a first loan) | CPF on an HDB loan; min 5% cash on a bank loan | The rest can be cash or CPF OA |
| Buyer's Stamp Duty | Cash or CPF | 1% to 6% on a banded scale; cannot be financed by the loan |
| Additional Buyer's Stamp Duty | Cash or CPF | Depends on residency and properties owned; nil for a Citizen's first home |
| Legal / conveyancing fee | Cash or CPF | Typically a few thousand dollars |
| Valuation fee (bank loan) | Cash | Bank assesses the property to set the loan amount |
| Home protection cover | CPF (HPS) or cash (private) | Mandatory mortgage cover for HDB flats bought with CPF |
Buying property triggers Buyer's Stamp Duty (BSD), and sometimes Additional Buyer's Stamp Duty (ABSD). These are separate from the loan but are part of your upfront cost, and you cannot pay them with the loan, so budget for them in cash or CPF.
BSD is charged on the higher of the price or market value, on a marginal (banded) basis, meaning each rate applies only to the slice of price in that band. The current schedule has held since 15 February 2023. ABSD depends on your residency and how many residential properties you already own; the rates below have held since 27 April 2023.
| Portion of price or value | BSD rate |
|---|---|
| First $180,000 | 1% |
| Next $180,000 (up to $360,000) | 2% |
| Next $640,000 (up to $1,000,000) | 3% |
| Next $500,000 (up to $1,500,000) | 4% |
| Next $1,500,000 (up to $3,000,000) | 5% |
| Amount above $3,000,000 | 6% |
A Singapore Citizen pays no ABSD on a first residential property, 20% on a second, and 30% on a third or later. Singapore PRs pay 5% on the first, 30% on the second, and 35% on the third. Foreigners pay 60% on any residential property. Entities pay 65%.
A common situation: a married couple with at least one Singapore Citizen, neither owning property, pays no ABSD on a joint first home. If one spouse already owns a flat, the couple can buy the new home, pay ABSD upfront, then apply for ABSD remission if they sell the first property and end up owning only the new one. The window to sell was extended from 6 months to 15 months from the date of purchase (or from TOP for an uncompleted property) with effect from 16 February 2024. Confirm the exact figures for your case on IRAS before you sign, since stamp duty is a YMYL number you do not want to estimate.
Our stamp duty calculator works out BSD and ABSD together for your price and profile.
The flat type changes the cash timeline more than the loan rate. A resale flat needs the full downpayment and stamp duty within weeks of the option. A BTO flat staggers payments over the two-to-four-year build, so you pay the option fee, then part of the downpayment at signing, then the rest at key collection, which is gentler on cash flow. The BTO vs resale comparison lays out the full timeline.
Going private changes the rules in three ways. There is no MSR, so only the 55% TDSR limits your loan, which can mean a larger loan on the same income. Tenure can stretch to 35 years (versus 30 on a bank loan for an HDB flat). And the cash component is the same 5% minimum, but on a larger price it is a far bigger absolute sum. Weigh the lifestyle and cost differences in HDB vs condo before assuming private is the upgrade.
One more thing private buyers should plan for: if you sell an HDB flat to fund a condo, the CPF used on the flat plus the accrued interest you would have earned goes back into your CPF first. That cuts the cash you walk away with, so model it before counting on a big cheque.
On a new BTO flat the 25% downpayment is not one bill. It splits across the two-to-four-year build, which is why a BTO is far gentler on cash than a resale flat where the whole sum falls due within weeks. You pay a booking (option) fee at flat selection, then the rest of the downpayment in two parts: a slice when you sign the Agreement for Lease, and the balance at key collection when the flat is ready.
The split depends on your loan. With an HDB loan you put down 5% at lease signing and the remaining 20% at key collection. With a bank loan you put down 10% at lease signing, of which at least 5% must be cash, and 15% at key collection. Young couples who qualify for the Deferred Income Assessment pay even less upfront, 2.5% at lease signing, with the rest at key collection. The booking fee counts towards your downpayment, so it is not an extra cost on top.
The full deferred chunk lands all at once at key collection, alongside stamp duty, legal fees, and renovation. Staggering is a timing tool, not a discount; you still pay the full 25%. Our staggered downpayment guide works through a full example, and the BTO affordability calculator pressure-tests the numbers.
A home loan comes with a hidden requirement most buyers only meet at signing: cover that clears the loan if you die or become unable to work, so your family is not left with the debt or the risk of losing the flat.
If you buy an HDB flat and pay any part of your monthly instalment from CPF, the Home Protection Scheme (HPS) is compulsory. HPS is a reducing-term cover from CPF that settles your outstanding HDB loan, up to the insured sum, if you die, are terminally ill, or are totally and permanently disabled. The annual premium is deducted automatically from your CPF Ordinary Account, and cover runs until you turn 65 or the loan is paid off, whichever comes first. If you pay your instalments fully in cash you are not forced into HPS, though CPF still encourages cover.
HPS only covers HDB flats. It does not apply to executive condominiums or private property, even an EC bought from a developer. Bank lenders do not legally require mortgage cover on a private home, but on a large private loan most buyers buy a private mortgage-reducing term policy themselves so the loan does not fall on the family. You can also apply to use HPS only if you have equivalent private cover for at least the same sum and term, which some buyers prefer for the flexibility. Weigh this against your wider insurance plan rather than treating it as a standalone tick-box.
Take a couple buying a $600,000 resale 4-room flat, combined income $9,000 a month, no other debt. The 75% LTV allows a $450,000 loan, so the downpayment is $150,000.
Under MSR, their home loan repayment cannot exceed 30% of $9,000, which is $2,700 a month. Stress-tested at 4%, a $450,000 loan over 25 years repays about $2,375 a month, inside the limit, so the loan size holds.
On the HDB loan at 2.6%, the real repayment on $450,000 over 25 years is about $2,041 a month, and the $150,000 downpayment can come entirely from CPF. On a bank loan at 1.45% fixed, the repayment drops to about $1,790, but they must put down at least $30,000 in cash. On top of either, BSD on $600,000 is $12,600 in cash or CPF (1% on the first $180,000, 2% on the next $180,000, and 3% on the remaining $240,000). The bank loan saves roughly $250 a month for the first few years; the HDB loan preserves cash and removes repricing risk.
On price, bank loans win in 2026: the cheapest fixed rates are near 1.4% versus the HDB loan's 2.6%, a saving of roughly $230 a month on a $400,000 loan over 25 years. The HDB loan wins on flexibility: no lock-in, no early repayment penalty, a fully-CPF downpayment, and a rate that never moves. Choose the bank loan if you want the lowest cost now and can handle repricing; choose the HDB loan for certainty and to preserve cash.
2.6% per annum, unchanged for over 20 years. It is pegged at 0.1 percentage point above the CPF Ordinary Account rate, which is at its 2.5% floor, and is reviewed every January, April, July and October. It will only change if the CPF OA rate moves above its floor.
25% of the price for a first housing loan, since the maximum loan (LTV) is 75%. On an HDB loan the whole 25% can be paid from your CPF Ordinary Account. On a bank loan, at least 5% of the price must be in cash, and the remaining 20% can be cash or CPF. On a first loan, the LTV drops to 55% (so a 45% downpayment) if the loan runs past age 65 or the tenure is too long. If you already have a housing loan outstanding, MAS caps the LTV lower still, at 45% for a second loan and 35% for a third or later, so the downpayment is correspondingly bigger.
TDSR caps all your monthly debt repayments at 55% of gross monthly income and applies to every property loan. MSR caps just the home loan repayment at 30% of gross monthly income and applies only to HDB flats and new executive condos bought from a developer. Private condos and landed homes face TDSR only. Banks compute both using a stress-test rate of 4% per annum, not your actual rate.
Yes, you can refinance an HDB loan to a bank loan at any time, with no penalty from HDB, since the HDB loan has no lock-in. The move is one-way: once your flat is financed by a bank, you can never switch back to the HDB concessionary loan. Make sure the bank's rate, after fees, beats 2.6% by enough to be worth it before switching.
An HDB concessionary loan runs up to 25 years. A bank loan runs up to 30 years on an HDB flat and up to 35 years on private property. A longer tenure means lower monthly repayments but more total interest. If the tenure extends past age 65, the LTV limit falls from 75% to 55%, so most buyers cap tenure to keep the higher loan amount.
You pay Buyer's Stamp Duty (BSD) on any property purchase, on a banded scale from 1% on the first $180,000 up to 6% above $3 million. A Singapore Citizen pays no Additional Buyer's Stamp Duty (ABSD) on a first residential property. Stamp duty cannot be paid with your loan, so budget for it separately in cash or CPF. Verify your exact amounts on IRAS.
Approval-in-Principle (AIP), also called In-Principle Approval, is a non-binding estimate from a bank of how much it will lend you, based on your income and existing debts. It is usually valid for about 30 days. Get one before you commit cash so you know your real budget. For an HDB loan the equivalent step is the HDB Flat Eligibility (HFE) letter, which you need before booking a new flat or granting an Option to Purchase on a resale flat.
Yes. You can pay your monthly instalments from your CPF Ordinary Account on both an HDB loan and a bank loan, as long as the property and your CPF usage qualify. Many buyers run the instalment fully from CPF and keep their cash. Remember the CPF you use, plus the accrued interest it would have earned, must be refunded to your CPF when you sell, so it is not free money.
For an HDB flat where you pay any part of the instalment from CPF, the Home Protection Scheme (HPS) is compulsory. HPS clears your outstanding HDB loan if you die, are terminally ill, or are totally and permanently disabled, and the premium is deducted from your CPF Ordinary Account. HPS does not cover executive condominiums or private property. Bank lenders do not legally require mortgage cover on a private home, but most buyers take a private mortgage-reducing term policy so the loan does not fall on the family.
Refinancing to a new bank means a legal conveyancing fee of a few thousand dollars plus a valuation fee. Banks often offer a legal-fee subsidy or cash rebate, but it is usually clawed back if you leave within about three years. Repricing within your existing bank skips most of these costs and the conversion fee is often small or waived. Avoid refinancing during your lock-in, where an early-repayment penalty of around 1.5% of the loan applies, and give the roughly three months' notice most loans require.
Singaporeans, PRs and foreigners can all take a bank loan, subject to income, age (most banks lend from 21) and the same 75% LTV and TDSR rules. Only the HDB concessionary loan is restricted: it needs at least one Singapore Citizen buyer and an income within the ceiling, so PRs and foreigners cannot take it. Foreigners also face 60% Additional Buyer's Stamp Duty on any residential property, and there are limits on the kinds of property a foreigner may buy, so check eligibility before committing.
Cash-over-valuation (COV) is the gap when a resale flat's agreed price is higher than its official valuation. The 75% loan applies to the lower valuation, not the price, so the COV gap cannot be financed or paid from CPF. You pay it in cash on top of your downpayment. On a resale flat you only get the official valuation after you have the Option to Purchase, so get an Approval-in-Principle and a realistic price view first to avoid a COV surprise.
Tenure is capped by the property and lender (25 years on an HDB loan, 30 years on a bank loan for an HDB flat, 35 years for private property) and by age. For the full 75% LTV the loan must finish by age 65, and banks use the income-weighted average age of joint borrowers. Stretch the tenure past 65 and the loan is still possible, but the LTV drops to 55%, so the downpayment rises from 25% to 45%. A longer tenure lowers the monthly repayment but increases total interest.
On a new BTO flat the 25% downpayment is split across the two-to-four-year construction. You pay a booking fee at flat selection (between $500 and $2,000 by flat type), then with an HDB loan put down 5% at Agreement for Lease signing and 20% at key collection. With a bank loan it is 10% at signing (at least 5% in cash) and 15% at key collection. Couples on the Deferred Income Assessment pay just 2.5% at signing. The booking fee counts towards the downpayment, and the total is still 25%.
This is general financial information for Singapore, not personal financial advice. Figures change — verify current rates against the official sources above before acting. See our full disclaimer.