Hints for Emigrants Applying a Housing Loan
In Singapore, housing loan packages have two categories: fixed rates or floating (variable) rates.
Fixed rates are sometimes extended for up to 3 years. However, other lenders can offer up to 5 years or 10 years. In many Western countries, fixed rates can be made throughout the loan tenure.
Floating rates can be classified into published rates or board rates. Like Singapore Interbank Offered Rate (SIBOR) or Singapore Swap Offer Rate (SOR), published rates are normally rates that are issued daily. Meanwhile, board rates are determined by the respective bank or financial institution. Many of the lenders set their board rates to a certain financial bench marks, yet the right elements are sometimes not clear and variations in board rates turn uncertain.
There are no restrictions for emigrants applying for housing loans. Still, the following factors should be looked at.
Loan to Value
The maximum loan to value (LTV) in Singapore is 90% of the purchase price or rating, whichever is lower. Many loaners do not give maximum LTV to emigrants, thus, housing loan packages for 90% financing are restricted. Loan approval for 90% financing is also tighter than for LTV 80% and below.
Proof of Income
To have approval for a housing loan your current income tax assessment or a letter of appointment from your local employer is necessary. Tax assessments from some countries may not be respected by the local mortgage lenders.
Landed Property
Before an emigrant can purchase restricted properties like vacant lot or landed properties such as bungalows, semi-detached, and terrace houses, the commendation from Singapore Land Authority is mandatory.
In-principle Approval
Try to apply for an in-principle approval before going with a purchase, since loan applications are more complex for emigrants. Think of hiring a respected and professional housing loan consultant. This may help you spare time and money with your loan approval.
Learn more about a premier housing loan advisory firm, providing housing loans with free mortgage broking.
Mail this post