Owner-Occupied Residential Properties
Monetary Authority of Singapore (MAS) has announced to exempt owner-occupied owners from the Total Debt Servicing Ratio (TDSR) of 60% when they refinance the property loan from bank, as long as they bought the property before 29 June 2013.
Also, the Mortgage Servicing Ratio (30% of borrower’s gross monthly salary) will also not apply to HDB flats and Executive Condominiums (ECs) when owners refinance the loan, as long as these homes were purchased before 12 January 2013 and 10 December 2013 respectively.
A similar concession will apply with regard to loan tenures, for residential properties purchased before the respective implementation dates for the new loan tenure limits of 30 years for HDB flat and 35 years for others. For HDB, the implementation date was 28 August 2013 and for other owner-occupied residential properties, the date was 6 October 2012. In such cases, borrowers will be allowed to maintain the remaining tenures of their loans at the point of refinancing.
Investment Residential Properties
The TDSR threshold of 60 per cent will continue to apply to the refinancing of all investment property loans. However, MAS will allow a transition period until 30 June 2017, during which a borrower may refinance his investment property loans above the 60 per cent threshold, provided he meets the following conditions:
(a) the property was bought before 29 June 2013;
(b) the borrower commits to a debt reduction plan with the financial institution (FI) at the point of refinancing; and
© the borrower fulfills the FI’s credit assessment.