Can I Borrow For The 20% Downpayment For Property Purchase?

You can borrow money from your friends and relatives
However
The bank is not allowed to disburse money or any credit
facility for the purchase of residential property (i.e. the 60%
or 80%, whatever the Loan-to-value requirements is) if you
cannot pay for the cash portion of the downpayment from
your own source of funds.


And in another way, if you qualify for a 80% loan

You have to fund the remaining 20% (minimum 5%
cash and 15% CPF) of the purchase price yourself.


The bank is prohibited from disbursing or lending you
the 80% if they are aware that you have borrowed
from any financial institution (regulated by the
authority or moneylender or any vendor's loan) the
required 20%.


All these is defined under MAS Notice 632 – 28 June
2013
“Purchaser’s Contribution
5. A bank shall not disburse funds under any credit facility for
the purchase of Residential Property until the Borrower has
paid, out of funds not obtained through any credit facility
granted by any financial institution regulated by the
Authority or moneylender, or any Vendor's Loan, at least the
difference between:
(a) the purchase price of the Residential Property; and
(b) the Relevant Amount,

All these is defined under MAS Notice 632 – 28 June
2013
“Purchaser’s Contribution
which difference shall include a minimum cash
payment of Cash% as referred to in paragraph 17(n). “
(Source: MAS Notice 632 – 28 June 2013)


However, corporations are not bounded by this rule
Because
Some corporations can lend you the downpayment. But then
they will be contravening another act as they are not licensed
money lenders or financial institutions, they cannot lend out
monies.


So

Strictly based on this definition, the only way to get a
loan to bridge this downpayment is to tap on informal
lenders - parents, relatives, friends.


So What Is Your Only Recourse?
It is possible that staff loans do not fall under this
category of “financial institutions” and they are not
lending to the public at large, and hence do not need
a license if they lend to their staff.
But

How many corporations are so generous to lend to
their staff the 20% downpayment?

You can check out the guys at
www.iCompareloan.com to compare singapore home
loans.


About Property Buyer Mortgage Consultants
Property Buyer Mortgage Consultants is a research focused independent mortgage broker. We
emphasize a consultative approach where we match our client’s financial situation with the best
fit mortgage loan, not simply a cheap loan.
We also help property buyers in their buying process helping them avoid pitfalls from
unscrupulous property agents. (We are not property agents, therefore there is no conflict of
interests.)
We also developed our proprietary home loan reporting tool which provides amongst other
things, 23 years Sibor history as well as 6 years worth of SOR.
Our service is free to you as banks pay us a commission on loan deals completed. Banks in turn
save on staffing cost as we are not on their payroll.
www.PropertyBuyer.com.sg/mortgage
www.SingaporeHomeLoan.net
www.iCompareLoan.com/consultant/


Can I Borrow For The 20% Downpayment For Property Purchase?

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Can I Borrow For The 20% Downpayment For Property Purchase?