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Anyone knows or familiar with how ipa is approved? How can one estimate or derive the loan quantum? Is there a specific formula to calculate the in principle approval loan Amt for purchasing a new ppty?
It beggars belief that someone with a 7k plus household income can garner more than 2 mil loan quantum?! Is that Possible?
I know for credit card or overdraft facilities, most banks offer up to 8 times mthly income for folks earning more than 10k a mth. Wonder if there's similar guidelines for ppty loan approvals?? Ie up to 8 times annual income for a 30 yrs loan?
NorthernStar
26-06-12, 06:57
Anyone knows or familiar with how ipa is approved? How can one estimate or derive the loan quantum? Is there a specific formula to calculate the in principle approval loan Amt for purchasing a new ppty?
It beggars belief that someone with a 7k plus household income can garner more than 2 mil loan quantum?! Is that Possible?
I know for credit card or overdraft facilities, most banks offer up to 8 times mthly income for folks earning more than 10k a mth. Wonder if there's similar guidelines for ppty loan approvals?? Ie up to 8 times annual income for a 30 yrs loan?
my hear-say is 40% of your income is the guideline for your first loan:
ie.
For a 35 years loans (bank can loan till 70 years-old, i asked in 2011)
Loan amount = $7000 * 0.4 * 12 * 35 = 1,176,000
My own guideline is borrow at-most 70% of what bank can loan you.:D
my hear-say is 40% of your income is the guideline for your first loan:
ie.
For a 35 years loans (bank can loan till 70 years-old, i asked in 2011)
Loan amount = $7000 * 0.4 * 12 * 35 = 1,176,000
My own guideline is borrow at-most 70% of what bank can loan you.:D
So far only one bank came back to me with a tentative ipa. Loan amt was lower than your 40% formula leh.. Actually for me is ok cos I'm buying a low quantum unit.. But was thinking it seemed quite conservative to offer around 9-10times annual package (excluding bonuses) for a 35 yrs loan.
Read from yowetan that his bank offered him close to 2mil. Lol..
So far only one bank came back to me with a tentative ipa. Loan amt was lower than your 40% formula leh.. Actually for me is ok cos I'm buying a low quantum unit.. But was thinking it seemed quite conservative to offer around 9-10times annual package (excluding bonuses) for a 35 yrs loan.
Read from yowetan that his bank offered him close to 2mil. Lol..
Bro, are you are taking his remarks seriously? :scared-5:
Mine also, it is about 9-10 times but with shorter period of 25years
Also, banks do take your gearing into consideration as well.. Eg car loan, outstanding loans from any finance company...
NorthernStar
26-06-12, 07:33
So far only one bank came back to me with a tentative ipa. Loan amt was lower than your 40% formula leh.. Actually for me is ok cos I'm buying a low quantum unit.. But was thinking it seemed quite conservative to offer around 9-10times annual package (excluding bonuses) for a 35 yrs loan.
Read from yowetan that his bank offered him close to 2mil. Lol..
That is rough amount bank offered me last year. Guess now banks have to tighten the loan amount.
Maybe Mr. Tan thought 2 banks can offer him $1mil each? :rolleyes:
Occupation type may influence the amount. I think they look at the job stability as well. I know someone who earns over 10K struggle to loan 300K and another earning just over 3K eligible for close to half a million.
Why Most Singaporeans Are in Debt
The current starting median pay for polytechnic graduates is $2,000, while for University graduates it is about $2,700. The median salary per month for Singaporeans in 2011 is $2,710. I really wonder how Singaporeans can stay out of debt if they continue to spend.
An example of a typical Singaporean couple
Take for example a Singaporean couple who falls in love and decide to settle down. The man is in his thirties and woman in her twenties. They have a combined income of about $8,000. The man buys a proposal ring that costs $7,000 (Larry’s brand as girlfriend likes it). The couple also buy a pair of engagement rings that costs $6,000 (Cartier due to peer pressure). The wedding photo package costs $6,000, wedding dinner costs $7,000, honeymoon to Korea $3,000. They then decide to apply for a DBSS flat after countless tries with HDB’s BTO without success and have to cough up $350,000 (by taking up an HDB loan and wiping out their CPF and savings). They then spend $20,000 on minor renovation and furniture.
The man decides to upgrade his car as he could not resist the latest continental car design and coughs up $100,000 (by taking a car loan). The man likes to collect watches, saw the latest Rolex and could not resist it. He has no cash but buys it for $12,000 with an interest free 24 month installment since it is so cheap per month.
Then the man tells himself that if he loses his job, he is finished. He is stuck in a rat race and saves on food, entertainment and transport cost. He does not drive his continental car to areas with ERP and instead takes the MRT there. The wife is in the finance industry, and with many banks doing cost cutting, she is very concerned now as she realizes she has nothing much to do during office hours.
The above is a real life story.
The only way the couple could afford all that is if they belong to the high earners group, if they have financial assistance from their parents or if they are born rich. Unfortunately, they are not.
We have not even talked about Singaporeans with lower earnings.
How Singaporeans get themselves in debt
Most Singaporeans will be in debt if they do the following:
1) Earn less than what they spend
2) Have no savings
3) Lose their jobs
4) Stay in a company for too long without promotion and their company pay them pathetic bonuses
5) Spend on liabilities
6) Do not delay gratification
7) Marries somebody that likes Cartier or Larry’s
8 ) Do not invest
To avoid racking up debt and getting stuck in the rat race, don’t do any of the above!
*By Kelvin Ng, who has been investing since 2007 and blogs at Personal Finance Master. Posted via www.MoneyMatters.sg (http://www.moneymatters.sg/), your guide on how to make more money, save smarter, invest intelligently, and enjoy your money like a pro. Click here to get our free report on what you must know about financial freedom.
live within your mean la~~
don't get tempted by all these stuffs..
:o
Bro, are you are taking his remarks seriously? :scared-5:
Mine also, it is about 9-10 times but with shorter period of 25years
Also, banks do take your gearing into consideration as well.. Eg car loan, outstanding loans from any finance company...
Haha just jesting nia bro. But just feel that Sg banks still quite conservative.. Which is gd! Less likelihood of subprime underwater like Europe and us.. Buying within one's means can't go wrong!
That is rough amount bank offered me last year. Guess now banks have to tighten the loan amount.
Maybe Mr. Tan thought 2 banks can offer him $1mil each? :rolleyes:
Think last yr ppty super hot so banks also more lenient this yr more scared? Lol..
Occupation type may influence the amount. I think they look at the job stability as well. I know someone who earns over 10K struggle to loan 300K and another earning just over 3K eligible for close to half a million.
Salaried worker vs commission earners I reckon.. Unless commission earner can prove that he is consistently earning 10k over extended period of say 2-3 yrs.
What is IPA? India Pale Ale? :cheers5:
NorthernStar
27-06-12, 08:05
What is IPA? India Pale Ale? :cheers5:
IN-PRINCIPLE APPROVAL
seems like US banks the most lenient in terms of loan amt vs local banks. the quantum range can be pretty wide.
Citi>Anz>Dbs. sg banks most conservative.. no wonder SG banks rated the safest in the world. :D
I just approached some banks on profolio investment.
In general, local banks cannot compete in term of pricing, product ranges, technical supports and services.
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