Housing Dilemma

[justforipad]

Hi, first, thank you in advance for the helpful comments/suggestions that you may provide.

About us


I am 28 years old, and she's 27 years old. We are aiming to get married before she turns 30. In other words, within the next 3 years or so. We are open to staying at one of our parents' place for a year to a year and a half after marriage at most.

Issue 1 - How are we assessed for grants?

We are currently both full time students, save to say, we have no real income nor any savings in our CPF accounts. Any purchase will be largely dependent on grants, if we are eligible in the first place. However, we are not that sure whether we are even eligible for the grants, AHG, SHG and whatnots.

We have never had full time employment, but I've been running a photography sideline but I've never earned more than a few hundred bucks a month. I've been running this sideline through a sole proprietorship that I registered only late last year despite having engaged in the business for a couple of years.

In such circumstances, will we be eligible for any grants say for the upcoming BTO window in may/june? If not, when, if ever, will we be eligible for the grants?

Issue 2 - BTO or EC?

We will be graduating in about june/july 2018. We have secured jobs and our estimated combined income starting in October 2018 will be about $7000 take home pay. Reviewing the pay schemes of our industry, we are projected to secure a combined take home pay of $10,000 by 2021, if not earlier.

In such circumstances, should we go for a BTO, which will take a good 3-4 years to complete at the minimum, or should we go for an EC, where we have to save diligently to afford the DP sometime in 2019/2020?

Issue 3 - Financial payments

How do we secure a HDB/Bank loan, will they assess our income at the point of booking our flat, exercising the OTP or when collecting the keys? Also, when do we need to pay the remainder of the downpayment in cash, where not already offset by any grants that we might receive?

Bearing in mind, of course, that there's other miscellaneous fees that have to be paid in cash such as stamp duty, etc.

Thank you all again, for going through this rather lengthy post. Will appreciate any comments or answers that you might have

 

[Chong1111]

Doubt u will be able to qualify for any grant, as most housing grant I've read about for bto needs at least a party to be in employment for at least a year.

And the type of housing depends on the size that both of you are looking at, and of course, the depth of your bank.

For ec, even if u saved up enough for downpayment, without a secured job you won't be able to get a bank loan. How are you going to pay off the remaining amount??

For bto, if you have no grant and no cpf, the downpayment and stamp duty need to be paid via cash too.

I would think that the best bet would be to save up and go for a resale few years down the road

 

[grix17]

Hi, you may like to calculate your projected CPF contribution by the time you are ready to buy a flat. If my facts are correct, you will need at least 10% of the value of the property in cash or CPF because the maximum loan is 90%.

If you're prepared to stay with parents, you should have about 2 years to save up, but don't forget your wedding expenses. As BTO is not a certainty, you may likely have to shop around for a resale. If you take the grants, I believe you will have used up your first-timer privilege.

 

[mrspiggy]

If you have no income prior to applying for BTO, I don't think you will qualify for any grants. Even if you are self-employed, I think there is a certain sum HDB is looking at.

As you have mentioned that you are earning a few hundred dollars each month, it is tough to qualify for grant too as HDB needs to see that at least one of you (either yourself or your partner) has a steady source of income to sustain the payment of the loan. HDB looks at only your current income; it does not look at your future potential earnings. If you cannot qualify for a HDB loan, it is harder to get a bank loan.

 

[justforipad]

If you have no income prior to applying for BTO, I don't think you will qualify for any grants. Even if you are self-employed, I think there is a certain sum HDB is looking at.

As you have mentioned that you are earning a few hundred dollars each month, it is tough to qualify for grant too as HDB needs to see that at least one of you (either yourself or your partner) has a steady source of income to sustain the payment of the loan. HDB looks at only your current income; it does not look at your future potential earnings. If you cannot qualify for a HDB loan, it is harder to get a bank loan.

any idea what's the lowest that they look at? My sole-proprietorship will be a year old in about half a year time.

 

[01asdf]

I would think you will be employed in 3 years' time by the time your number is up. Even a continuous income of 1k per month should be sufficient to qualify for the grants. Isn't that one of their talking points - that 1k can buy HDB?

 

[SBC]

Skip EC for young starters unless got golden mountain behind.

 

[Gixxerfied]

$7k combined starting and projected 10k by 2021??? Skip the EC idea..

There is a reason why HDB raise the income ceiling to 12k for HDB and 15k for EC..

 

[vinz]

No proper income = no loan.
No loan = can't even apply for any bto or talk about resale.

Criteria for self employed and employee is different for a HDB loan. It is much stricter for a self employed. Please check hdb website on what you need to provide them in order to assess your loan amount.

Hdb and bank are looking at real income, and not "potential income" by home buyer few year down the road.

It seems the grant for "low income" is a loophole for those with potential much higher income to apply and get it before they officially join the workforce full time.

 

[mrspiggy]

any idea what's the lowest that they look at? My sole-proprietorship will be a year old in about half a year time.

I am not sure what is the sum HDB is looking for. Maybe you can call HDB and ask directly.

 

[mrspiggy]

No proper income = no loan.
No loan = can't even apply for any bto or talk about resale.

Criteria for self employed and employee is different for a HDB loan. It is much stricter for a self employed. Please check hdb website on what you need to provide them in order to assess your loan amount.

Hdb and bank are looking at real income, and not "potential income" by home buyer few year down the road.

It seems the grant for "low income" is a loophole for those with potential much higher income to apply and get it before they officially join the workforce full time.

Ya HDB and banks are looking at your real incomes currently, not your projected income.

Like what you said,
No income = no loan = no grant = no HDB

 

[justforipad]

No proper income = no loan.
No loan = can't even apply for any bto or talk about resale.

Criteria for self employed and employee is different for a HDB loan. It is much stricter for a self employed. Please check hdb website on what you need to provide them in order to assess your loan amount.

Hdb and bank are looking at real income, and not "potential income" by home buyer few year down the road.

It seems the grant for "low income" is a loophole for those with potential much higher income to apply and get it before they officially join the workforce full time.

is the loan quantum not considered at the point when we collect the keys?

 

[justforipad]

Ya HDB and banks are looking at your real incomes currently, not your projected income.

Like what you said,
No income = no loan = no grant = no HDB

I have an income, just that its not substantial, does it still mean no grant?

 

[simple_n_eazi]

I am currently considering getting a 3bedroom EC as well that costs about 800k. I have worked about 6 years and my combined income is exceeding hdb ceiling but the 20% inital deposit will still wipe up a substantial amount of our cpf and savings. Thus, as a student and potential combined income of 7k, I am a bit worried you may have difficulty with the upfront 20% unless you have external support eg. Parents. Other than monthly instalments, do also consider the initial upfront payment too.

 

[SecretAgent]

grant aside.. you'll still have to fork out for the loan... how much can you down first that's the question? 400k? 500k? this part settled then come talk about grant and loan.

 

[kingkongikiss]

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[eriolmoon2008]

Just focus ur studies..... think bout it after u found a full time job...now too early...

 

[eternal-snow]

I think after your studies and working for 1 year, you both can try to apply for sales of balance flat.

That way with 1 year of work, you are eligible for housing grants being a first timer and you don't have to wait so long for housing as compared to bto.


The downside are these sbf are leftover flats from the bto selection. Hopefully there are still good units available.
The flats are also a bit more expensive than bto (as they are nearer to completion date) but at least you are able to settle down sooner.

 

[lordlad0]

hdb is ***** heartless, no work mean u no income to buy. 100% no grant too and 100% no loan. they don't allow u to bto or buy any flat...

it's not heartless...it's pragmatic...

it will be irresponsible for HDB to allow every tom dick and harry without income or reasonable credit rating to buy a flat...

the mortgage crisis in US can be ultimately attributed to the banks allowing loans to all the brainless pauper that barely afford the house to take up loans and look at that mess it created..

I agree with HDB in this case.....it is right to be 'heartless'.

 

[qhong61]

hdb is ***** heartless, no work mean u no income to buy. 100% no grant too and 100% no loan. they don't allow u to bto or buy any flat...

No income how to pay?