You dream about buying or constructing your home, for it gives you freedom from paying higher rent and changing the rented house every year, or for a place that can hold all your lovely memories. Nevertheless, buying a home in Singapore has become difficult as the property rates have seen an unprecedented increase in the recent past.
Any person dreams about owning a home. You can either build or buy a home when you find the one suitable to your requirements. Often you may find a home, but you cannot afford to buy it because you are short of money. This is where the home loans in Singapore come in. You can now take-home loans easily and buy the home of your dreams in Singapore.
What is a home loan? It is an amount of money offered to the borrower by a bank or a housing finance company. The loan amount and tenure are based on the eligibility of the applicant. The loan is dispersed on an agreement that it will be paid in equated monthly instalments, along with the mentioned interest rate.
Various Benefits of taking a Home Loan in Singapore
The interest rates on home loans are low and affordable. It may be a fixed rate or adjustable rate. However, you can have a customizable home loan with interest in fixed rate and floating rate in one loan package. For instance, you can have a part of your property loan at the fixed interest rate and the remaining part of the loan at the floating interest rate.
It will help you enjoy the floating interest rate and save money in the future. With a fixed one, you have to pay the same interest for a certain period that you have agreed to have a fixed interest rate.
On the other hand, an adjustable loan keeps changing with changes in the loan market. However, it starts with low-interest rates. For this reason, more people opt for it.
You can find several banks and financial institutions offering home loans in Singapore. For instance, DBS offers different types of loans to suit your needs. They include:
- Buying private property
- Refinancing private property loan
- Buying executive condominium
- Refinancing executive condominium
- Buying flat
- Refinancing loan
- Bridging loan
- Renovation loan
- Home equity income loan
- Managing your existing home loan
If you take a home loan at a young age, you will get the maximum loan tenure possible. However, the regulations have loan tenures of 30 years. For loan tenure longer than 25 years, the loan amount is reduced to 55% of the property purchase price.
The loan amount available varies according to the “Total Debt Servicing Ratio (TDSR) and this ratio is capped at 55% of the borrowers’ gross monthly income.” Moreover, it also depends on the loan term, which may be up to 30 years. The loan term depends on the amount of loan taken. If the amount is higher, the tenure is also higher. You have to repay the loan by the end of the term. You can use this loan to buy or repair any type of home or property.
Before going for a home loan, have a detailed study of the various home loans available in the market and decide on the most suitable one. You can find the best finance companies providing home loans on the Internet. Compare and choose the one that fits your budget. In case you have any doubts, you can get them cleared before applying for the loan.