Latest Singapore Property News

Total Debt Servicing Ratio on Property Refinancing Fine-tuned

Singapore, September 2016 - The Monetary Authority of Singapore (MAS) announced in Sept that the refinancing rules under the Total Debt Servicing Ratio (TDSR) framework will be fine-tuned to allow borrowers more flexibility in managing their debt obligations. This is in response to feedback from some borrowers who are unable to refinance their existing property loans owing to the application of the TDSR threshold of 60 per cent.

The TDSR framework and threshold will continue to apply to new property loans. The refinements being introduced for refinancing of loans will enable borrowers to better manage their existing debts. They do not represent a relaxation of property market cooling measures.

Refinancing of owner-occupied housing loans

Under current rules, for owner-occupied residential properties bought before the introduction of TDSR, a borrower may be exempted from the TDSR framework when he refinances his housing loan.

MAS will now extend the same concession on refinancing to all owner-occupied residential properties, including those bought after the introduction of TDSR[1]. This adjustment recognises that all new housing loans would have been subjected to the TDSR framework at inception.
 
singaporeprivateproperty

Refinancing of investment property loans

Currently, for properties that were purchased for investment before the introduction of TDSR, borrowers can refinance above the TDSR threshold of 60 per cent if they commit to debt reduction plans when refinancing their loans.

MAS will now allow a borrower to refinance his investment property loan above the TDSR threshold, regardless of when the property was purchased, if he meets the following two conditions[2]:

(a) commits to a debt reduction plan with his financial institution to repay at least 3 per cent of the outstanding balance over a period of not more than 3 years; and
(b) fulfils his financial institution’s credit assessment.

MAS reiterates the importance for borrowers to exercise prudence and reduce their debt burdens, as the current low interest rate environment will not persist indefinitely. Borrowers will face higher mortgage repayments when interest rates rise.

The revised rules will take immediate effect[3]. Please refer to the table below for a summary of the rules.
singaporeTDSR refinancing relaxed

MAS Deputy Managing Director, Mr Ong Chong Tee, said: “The TDSR is a structural measure to encourage prudent borrowing by households. The adjustments announced today will help borrowers to refinance their existing property loans at lower interest rates and better manage their debt obligations over time. They do not apply to loans for new property purchases and are not an easing of the property cooling measures.”

singaporeprivateproperty
 


1 The same concession will be extended to the Mortgage Servicing Ratio limit of 30 per cent for the refinancing of housing loans relating to HDB flats and Executive Condominiums that are owner-occupied.
2 This includes a loan secured on a borrower’s equity in a property.
3 This supersedes the 10 February 2014 announcement where a transition period ending 30 June 2017 was given to borrowers who purchased their properties prior to the introduction of TDSR to refinance their investment property loans above the TDSR threshold.
 
Credits: MAS

 

Add comment

Emails are optional and for tracking replies. Names are unique; get yours today with a comment!


Security code
Refresh

La Business

Fed keeps benchmark interest rate unchanged, but signals rate cuts in future
Fed keeps benchmark interest rate unchanged, but signals rate cuts in future

  The U.S. Federal Reserve has kept interest rates unchanged,... but hinted  [ ... ]

Read more la
Huawei signs deal with Russian telecoms firm to develop 5G
Huawei signs deal with Russian telecoms firm to develop 5G

  China's Huawei has signed a deal with Russian telecoms firm MTS to develop 5G  [ ... ]

Read more la
Mastercard drops Neymar from campaign amid rape allegation
Mastercard drops Neymar from campaign amid rape allegation

  Mastercard has canceled a planned advertising campaign featuring Brazilian s [ ... ]

Read more la
World Bank downgrades 2019 global economic outlook to 2.6%
World Bank downgrades 2019 global economic outlook to 2.6%

  The World Bank has downgraded its global economic outlook for this year to two [ ... ]

Read more la
Fed Chairman Jerome Powell hints at possible rate cut if necessary, citing trade war with China
Fed Chairman Jerome Powell hints at possible rate cut if necessary, citing trade war with China

  The head of the U.S. Federal Reserve has hinted at a possible interest rate  [ ... ]

Read more la
Generation Z seeks fun and relies on influencers when shopping
Generation Z seeks fun and relies on influencers when shopping

  It appears those born in the mid-90s or later - have unique shopping habits... [ ... ]

Read more la
China's Huawei holds world's No. 2 smartphone spot in Q1: Report
China's Huawei holds world's No. 2 smartphone spot in Q1: Report

  China's telecom company Huawei maintained its spot as the world's second-l [ ... ]

Read more la
Fiat Chrysler proposes merger with Renault
Fiat Chrysler proposes merger with Renault

  Italian-American automaker Fiat Chrysler proposed joining forces with French [ ... ]

Read more la
Huawei calls on Korean chipmakers to continue their parts supply
Huawei calls on Korean chipmakers to continue their parts supply

  South Korean companies are finding themselves stuck in the middle of t [ ... ]

Read more la
Huawei kicked out from Wi-Fi Alliance, SD Association, other standard groups
Huawei kicked out from Wi-Fi Alliance, SD Association, other standard groups

  The bad news keeps piling up for under-fire Huawei.
Reports say the Chinese [ ... ]

Read more la
Trump announces new US$16 bil. aid package for American farmers hit by trade war
Trump announces new US$16 bil. aid package for American farmers hit by trade war

  U.S. President Donald Trump has announced a new 16 billion dollar aid package  [ ... ]

Read more la
IMF says US companies are paying China tariff costs
IMF says US companies are paying China tariff costs

  The International Monetary Fund says companies in the U.S. are paying al [ ... ]

Read more la
Reaction to collapse of Jamie Oliver’s restaurant chain
Reaction to collapse of Jamie Oliver’s restaurant chain

  Jamie Oliver's restaurant chain has become the latest to collapse into adminis [ ... ]

Read more la
US slows hiring of Chinese nationals by chip makers
US slows hiring of Chinese nationals by chip makers

  The United States is slowing approvals for its semiconductor companies to hire [ ... ]

Read more la

Our Sponsors


La Latest

Boris pressed over mystery photo with girlfriend - UK PM wannabe

  Boris Johnson faces questions from listeners on LBC Radio in an interview wi [ ... ]

Read more la
Bitcoin price surges above US $11,000 mark, highest in 15 months

  The price of Bitcoin soared above the 11-thousand U.S. dollars on Monday,... [ ... ]

Read more la
Huawei sues US Commerce Dept over mishandled package

  Huawei has filed a civil lawsuit against the U.S. Commerce Department ov [ ... ]

Read more la
More than half of S. Korean job seekers think it's impossible...

  South Korean jobseekers want their dream salary to be around 83-thousand dolla [ ... ]

Read more la
Jeremy Hunt vs Boris Johnson for UK PM; more live TV debates wanted

  Jeremy Hunt has challenged Boris Johnson to take part in live TV debates bef [ ... ]

Read more la
Fed keeps benchmark interest rate unchanged, but signals rate cuts in future

  The U.S. Federal Reserve has kept interest rates unchanged,... but hinted  [ ... ]

Read more la
4 facing murder charges for downing Malaysian Airlines MH17

  Four people will face prosecution over the downing of Malaysia Airlines fl [ ... ]

Read more la
Trump abruptly calls off military strikes against Iran after hearing they could kill 150 people

  Now, for the latest on the escalating tensions between Washington and Tehran.  [ ... ]

Read more la

La Entertain

BTS launches new mobile game where players manage band

  Imagine you could make decisions about Korean boyband BTS' career,... how  [ ... ]

Read more la
Zhao Liying shares first photo after having baby son "little piglet"

On 23 Jun 2019, Zhao Liying shares with fans her first photo after delivering her baby son with husb [ ... ]

Read more la
Toy Story 4 & Child's Play returns

  It's Thursday so we are going to turn our focus on movies and the latest release [ ... ]

Read more la
BTS tours Japan next month, starting from Osaka

  Ticket sales from this year's world tour by K-pop group BTS have reached alm [ ... ]

Read more la
France's Lumiere Film Festival likes 'Parasite' director

  South Korean director Bong Joon-ho has been invited to this year's Lumiere F [ ... ]

Read more la
Netmarble to release 'BTS World' mobile game on June 26

  Local game maker Netmarble will release its new mobile game "BTS World" global [ ... ]

Read more la
Korea vs China Dance Off in Seoul

  An event was held today in Seoul to promote friendship between China and S [ ... ]

Read more la
BTS and Bang Si-hyuk to join voting for Grammy Awards

  K-Pop sensations BTS and their chief producer have clinched memberships to the [ ... ]

Read more la