HDB loan

If you are someone who is eagerly eyeing to purchase an HDB apartment unit, but is anxious about it because you know so well that your gross monthly income is something that doesn’t really give you the privilege to buy the flat upfront, then you are definitely someone who will get a home loan sooner or later. 

Now, as property buyers, people usually apply for the HDB Concessionary Loan (also shortly and popularly known as HDB loan).  This loan is a mortgage that is regulated, issued, and controlled by the Singapore government. 

While there is importance in knowing which HDB concessionary loan fits your needs best, it is also very crucial to know if you are eligible in the first place, and if so, you know how to apply for one.  Let’s get the first problem sorted out first: are you eligible for the loan?

What Determines Your Loan Eligibility?

The government institutions in Singapore have made clear standards to gauge whether or not people are eligible for an HDB concessionary loan. To start, you must be an employed person during the month you applied for the loan–and should remain so before the HDB flat loan is issued to you.  Let’s get to the remaining requirements as we move along.

1) What is the difference between a first-time homebuyer and someone who has a property already?

There is a different application process for those who have bought HDB property already, especially those who wish to purchase another HDB flat after having gotten rid of the previously existing one.  Those who have purchased a flat before must submit their:

Completion statements: which should show the cash proceeds and HDB CPF refund breakdown computation; and/or documents that give proof of divorce. These documents must show the division of the HDB flat (especially if the HDB in the past has already been disposed of by the ex-spouse). 

2) What does a first time home buyer need to know to get started?

To get started, you should know that access to an HDB concessionary loan requires one to go through a particular HDB process that will include an HDB concessionary loan letter. 

This letter must be accompanied by the necessary income-based documents in order for the government body or the credit bureau to assist you with the processing of your HDB applications. 

If the documents required of you are not complete, your application may be placed to a halt until all the important documents have been submitted. 

It is very important to know that requirements vary for first-time homebuyers– let’s say if the home buyer has a local job designation and works in Singapore, or if they have a work appointment and are working as overseas job workers. 

3) What are the criteria listed for all prospective homeowners?

The criteria are as follows:

A) Citizenship. At least one of the applicants for the loan amount  should be a citizen of Singapore;

B) Household status. Applicants must be those who have not had 2 or more HDB home loans. In other words, applicants can only have one loan application. However, if you already have one housing loan in the past, from the HDB, it should not be a private residential property (and it won’t matter if this is locally-situated or overseas).

C). Income ceiling. As an applicant your average gross monthly income should not exceed  $14,000 for families. If you are an extended family, your household income should not exceed $21,000.00. Moreover, if you are single, your income stream should not exceed more than $7,000.00.

D). Interest or Ownership of Property.  You should not be owning private residential properties for at least thirty months prior to your home loan application.  Even if the property has been given to you as a gift, you should still be an applicant who does not have these things. Otherwise, you will fail to meet the HLE criteria. 

4) What do we have to keep in mind the Loan to Value limit (TLV), mortgage servicing ratio (MSR) & Total Debt Servicing Ratio (TDSR)?

Another criteria to consider to meet so that you can qualify for an HDB loan is that your loan amount will vary and shall be based on how far the remaining lease can cover the applicant–up to the age of 95 years old. 

You should take note that you are allowed for the HDB housing loan (whilst subject to approval) if the TLV (also known as the loan-to-value) limit if of 90% and that your loan tenure is the shortest of:

25 years; or the remaining lease while being at the period of the property application, less twenty years; or 65 years–less the average age of the applicant. Learn more on Total Debt Servicing Ratio.

5) How much are you eligible for, then?

If you think you are eligible to obtain an HDB loan given the terms indicated above,  the next thing is to know how much of an amount can be placed into your account.

You can find out about how much you can get from the HDB concessionary loan through Singapore’s HDB hub website. There, a loan calculator is placed, where you will have to declare some of your personal details. 

The online calculator will compute the maximum amount you could be eligible for, and usually, this will depend on the families you are with, your income proof, your bank statements, and more.

What is the HLE Letter & How Does It Affect Borrowers?

1) What is an HLE letter?

An HLE letter is actually a tool used by borrowers for financial planning. This tool could provide you with data on your:

  • Loan amount eligibility;
  • Your monthly amortizations and repayment schemes;
  • The cash proceeds made from the disposal of your previous or currently existing flat; and even
  • Other terms, conditions, and account information, based on the statutory declaration you have been required of. 

The HLE letter is only valid for a maximum of six months from the moment this has been provided for you.  If there have been no changes in the info regarding your family members, if with your financial account s, then you will no longer need a re-assessment during the duration of the validity of the loan qualification letter.

One thing that you should remember, is that the following income documentation will not be accepted as a factor for your credit assessment:

  • Allowance pay (as income)
  • Rental income
  • Work commission 
  • Dividend income allowance
  • National service allowance
  • Director’s fees
  • Reimbursement expenses for job workers
  • Occupier’s commission income
  • Overtime income or overtime commission
  • And more bonuses and commission that are noted aside from your basic salary income. 

2) How does it affect prospective borrowers?

The use of the loan eligibility HLE letter will affect prospect borrowers in the sense that due diligence will be made with them by the credit bureau. 

3) Where can I apply?

If you are qualified for the HDB loan,  you should be able to apply and upload your requirements and other documentation on www.hdb.gov.sg/hleapply

How Do You Apply for a HDB Loan?

The HDB board will process and study your submitted data, including the HLE letter, your proof of pay and income (this is a statutory declaration), your tax assessment form, and other account information. 

This process will last within 14 days from the submission of your pre-documents. You can also check the HDB website in order to check on the status of your application. It doesn’t matter if you are using a business profile computer or a personal one. 

How Different Borrowers Types Can Affect Your Loan Eligibility

Based on the criteria we have talked about above, the results of your eligibility may vary. For instance, if you are single, your income amount should not exceed S$7,000.

Of course, there are other types of borrowers (such as those who have their own families, or those who live with or belong to, an extended family). Consequently, data placed on the HLE letter will vary because of the different borrower types and cases. 

A Step by Step Guide to Applying Online

This is actually an easy two-step process in applying for an HDB Concessionary loan online:

1) The first step is to be able to grab a hold of, as well as fill out the HLE letter (or the loan eligibility letter) which can also be accessed online.  You will need to complete this CPF letter, and secure your required documentation. 

2) The second and last part of the process is to be able to upload all these documentation and requirements to the HDB online portal. 

This seems simple, right? Afterward, you can wait for 14 business days maximum for your results. 

Here’s a pro tip: Once your items are processed and approved, an HDB worker (most likely from the credit bureau) will get in touch with you and will talk to you about your loan amount for your flat. They will confirm more loan matters with you, including the loan quantum,  your CPF ordinary account, financing mortgages, and other rental income interest that may affect your income. 

What Are Your Repayment Options and What Happens If You Can’t Repay?

Once your HDB loan is approved, you need to become aware more about your repayment option and what you can expect about the interest rate and other pay should you fail to adhere to them. 

Payment options include:

1) Monthly loan installments. 

This installment will have an amount charged on the first day of your second month, post-loan approval. 

After this, be aware that your monthly installments will have their due dates that should be payable on the 1st day of the following months (if your payments are not being transacted through CPF or GIRO). This will continue until your house loans have been fully redeemed. Various payment options can be done through this repayment scheme, which includes the CPF, GIRO, and eNETS Debit, among others.

2) Partial capital repayments.

By giving the HDB at least 1 month of notice ahead of your changes, the creation of partial capital repayments may be an option for you.  All you have to do is to apply for an online partial capital repayment scheme for your HDB loan.

3) Other arrears repayment schemes. 

There are so many more options for you to be able to pay your arrears. More electronic payment methods can be done electronically through eNETS Debit or NETS or through GIRO or even manually through cheque.

What Happens If You Cannot Repay The Loan

If you fail to repay the loan, you should be aware that the mandated option for you is to pay for some late payment charges with an amount based on the 2% above Singapore’s Ministry of Finance PLR (or prime lending rate. For updated knowledge, the late payment rate is at 7.5% per year. These late payments are usually being reviewed and reassessed each year. 

What Happens Next

Now after passing all your assessment processes and after having been given your HDB loan and your flat, you should be able to enjoy living now. All you have to do is to avoid an unnecessary interest rate, for instance, just because you have missed the payment of your home loan arrears. 


Obtaining your own flat through the HDB amount program is something that is achievable–as long as you are eligible and qualified for the loan.  We aim that you are now more aware of the options you can take and the processes that come along with it. 

So, go ahead and review your requirements at hand and apply for your HDB in Singapore now!