View Full Version : New Cooling Measures
After J Gateway, Tharman drop this bomb..:spliff:
MAS Introduces Debt Servicing Framework for Property Loans
Singapore, 28 June 2013 … The Monetary Authority of Singapore (MAS) will introduce a Total Debt Servicing Ratio (TDSR) framework for all property loans granted by financial institutions (FIs) to individuals1. This will require FIs to take into consideration borrowers’ other outstanding debt obligations when granting property loans. They will help strengthen credit underwriting practices by FIs and encourage financial prudence among borrowers.
2 MAS will also refine rules related to the application of the existing Loan-to-Value (LTV) limits on housing loans. These refinements seek to ensure the effectiveness of the LTV limits that were put in place to cool investment demand in the housing market. In particular, they aim to prevent circumvention of the tighter LTV limits on second and subsequent housing loans.
Introduction of TDSR framework
3 MAS conducted a thematic inspection of banks’ residential property loan portfolios in 2012. While banks generally had in place sound policies to assess the credit worthiness of borrowers, the inspection and subsequent surveys revealed uneven practices with respect to the application of debt servicing ratios and highlighted areas for improvement in credit underwriting practices.
4 The TDSR framework will provide FIs a robust basis for assessing the debt servicing ability of borrowers applying for property loans, taking into consideration their other outstanding debt obligations. FIs will be required to compute the TDSR, or the percentage of total monthly debt obligations to gross monthly income, on a consistent basis.2
5 The coverage of the TDSR framework will be more comprehensive than FIs’ current practice. The TDSR will apply to loans for the purchase of all types of property, loans secured on property,3 and the re-financing of all such loans.4
6 The methodology for computing the TDSR will be standardised. FIs will be required to:
take into account the monthly repayment for the property loan that the borrower is applying for plus the monthly repayments on all other outstanding property and non-property debt obligations of the borrower;
apply a specified medium-term interest rate or the prevailing market interest rate, whichever is higher, to the property loan that the borrower is applying for when calculating the TDSR;5
apply a haircut of at least 30% to all variable income (e.g. bonuses) and rental income; and
apply haircuts to and amortise the value of any eligible financial assets taken into consideration in assessing the borrower’s debt servicing ability, in order to convert them into ‘income streams’ in computing the TDSR.7 FIs will be required to verify and obtain relevant documentation on a borrower’s debt obligations and income used in the computation of the TDSR.
8 MAS expects any property loan extended by the FI to not exceed a TDSR threshold of 60% and will regard any property loan in excess of a 60% TDSR to be imprudent.6 The threshold is set at 60% for a start to allow both the FIs and borrowers to familiarise themselves with the TDSR framework and its computation methodology. MAS will monitor and review the 60% threshold over time, with a view to further encouraging financial prudence.
Refinement of rules related to application of LTV limits
9 MAS will refine certain rules related to the application of the existing LTV limits on housing loans granted by FIs. In particular, MAS will require:
borrowers named on a property loan to be the mortgagors of the residential property for which the loan is taken;
“guarantors” who are standing guarantee for borrowers otherwise assessed by the FI at the point of application for the housing loan not to meet the TDSR threshold for a property loan to be brought in as co-borrowers; and
in the case of joint borrowers, that FIs use the income-weighted average age of borrowers7 when applying the rules on loan tenure.8Measures for the long term
10 The new rules will take effect from 29 June 2013.
11 The TDSR framework and refinements to the rules relating to the application of LTV limits are structural in nature, and will be in place for the long term. They aim to encourage prudent borrowing by households and strengthen credit underwriting standards by FIs.
12 They do not involve changes to the LTV limits on housing loans themselves, which were last tightened in January 2013 as part of the government’s package of measures to promote stable and sustainable conditions in the housing market.9 The current LTV limits are not permanent, and will be reviewed depending on the state of the property market.
13 Please refer to the FAQs on MAS’ website for further details.
CondoInterested
28-06-13, 19:37
wah, cheem leh.
Can explain in shorter words.
wah, cheem leh.
Can explain in shorter words.
Buy MM.....
wah, cheem leh.
Can explain in shorter words.
Tharman thinks he's very smart when actually he is over micro-managing the market, probably with eventual bad results
Then tose who buy Jurong gateway today will the measures affect them?
After J Gateway, Tharman drop this bomb..:spliff:
Many thanks for sharing. Think it would have an impact on the property market. :eek:
I tink if cant get bank loan, the buyers just need to return the units.....won't lose alot of $
Then tose who buy Jurong gateway today will the measures affect them?
New measures start from 29/6 tomorrow. One more reason to close deal and send application today.
I tink if cant get bank loan, the buyers just need to return the units.....won't lose alot of $
but being there the whole day, finally grabbing the unit and then received this bomb news, think it would be quite a let down.
They closed the loophole on borrowing under non-owner name i.e. mortgagor and borrower different person.
Parents cannot take loans off children names liao.
They closed the loophole on borrowing under non-owner name i.e. mortgagor and borrower different person.
Parents cannot take loans off children names liao.
oh, i understand now. thanks.
princess_morbucks
28-06-13, 20:02
It will affect those who refinance too.
Toooo deep... don't understand
Then tose who buy Jurong gateway today will the measures affect them?
no if they sign their otp today.
It will affect those who refinance too.
it will affect those who use their siblings and relatives' name to buy property.
princess_morbucks
28-06-13, 20:08
J gateway is not launched yet.
Today was the pre launch.
So potential buyers hand in blank cheque.
If they can't qualify, then just take back the cheque.
I don't think they will lose any money.
MCL timing is superb. I am not sure if they have gotten insider information
They predicting QE4 coming.
phantom_opera
28-06-13, 20:14
interesting ... when economy no good QE comes, property goes up, when Fed threatens to stop QE when economy improves property also goes up
They closed the loophole on borrowing under non-owner name i.e. mortgagor and borrower different person.
Parents cannot take loans off children names liao.
FINALLY.
borrowers named on a property loan to be the mortgagors of the residential property for which the loan is taken;
“guarantors” who are standing guarantee for borrowers otherwise assessed by the FI at the point of application for the housing loan not to meet the TDSR threshold for a property loan to be brought in as co-borrowers; and
in the case of joint borrowers, that FIs use the income-weighted average age of borrowers7 when applying the rules on loan tenure.
Would you believe I actually spent like close to an hour some months back talking to some MAS officer on the phone, explaining to them the average age problem.
The stupid officer still keep trying to defend it and they say the banks will use the "proper" age and they will monitor it.
I was like, duh.... all these measures are in place because the banks cannot be trusted to be prudent. Given clinching a business, they will try to sell the loan by using the youngest age of the borrowers.
I told them specifically that they have to use the income weighted average age so it is CLEAR CUT. why make it so ambiguous???
princess_morbucks
28-06-13, 20:16
Sorry..... what is income weighted average age?
After reading this... if MAS enforces this, I think those people relying on rental income can forget about any refinancing.
Example, if currently you rent your place out for 2k/month, your monthly installment is 2k/month so you happy right? Bank also loan you money, everyone happy.
With this new ruling, rental income is calulated based on 30% discount... so it ends up to be $1.4k. Of these $1.4k, you can only use 60% to finance your loan. That is like 0.84k. So they bank can only loan you up to 0.84k/monthly repayment.... Furthermore, you have to use medium term interest rate 3.5% to calculate repayment...
That is terrible right?
phantom_opera
28-06-13, 20:22
from salary.sg
Banks use the Debt Service Ratio to assess your creditworthiness.
Defined as the monthly loan installment amount divided by your gross monthly income, your DSR typically has to be somewhere in the 35% to 40% region for banks to be happy to grant you that mortgage. (See also past article on second home loan.)
However, the DSR ratio doesn’t say if you’re taking up excessive loans.
You may have a low overall DSR, but due to low interest rates and long mortgage tenors, you may be piling up too much loans. Or maybe your income has just gone up (how nice) , but with savings still remaining low, your DSR may look deceptively good.
It is even possible to have negative net worth with good-looking DSR. Banks don’t care, but I hope you do.
To be safer, you should also look at your Debt to Net Worth ratio.
- See more at: http://www.salary.sg/2009/can-you-afford-that-condo-introducing-the-debt-ratios/#sthash.iXZPeIJa.dpuf
WAHLAUEH ! NO MORE CM PLEASE ARHHHHHHHHHHH, my balls are shrinking liao la !
:doh: :doh: :doh:
Sorry..... what is income weighted average age?
the age will be weighter closer to the higher income earner.
the more I think about it, the more it does not make sense.
This rule now literally makes it IMPOSSIBLE for people relying on rental income to get financing anymore.
After reading this... if MAS enforces this, I think those people relying on rental income can forget about any refinancing.
Example, if currently you rent your place out for 2k/month, your monthly installment is 2k/month so you happy right? Bank also loan you money, everyone happy.
With this new ruling, rental income is calulated based on 30% discount... so it ends up to be $1.4k. Of these $1.4k, you can only use 60% to finance your loan. That is like 0.84k. So they bank can only loan you up to 0.84k/monthly repayment....
That is terrible right?
Before you buy property, you sure must have a job and regular income before banks will approve your loan, and they will not factor in the rental income of your yet to be purchase property.
phantom_opera
28-06-13, 20:28
take into account the monthly repayment for the property loan that the borrower is applying for plus the monthly repayments on all other outstanding property and non-property debt obligations of the borrower;
e.g. your gross monthly income is 10k, first loan 1.5k, 2nd loan 2k, car loan 1k so total is 1.5+2+1 = 4.5k ... a TDSR of 60% can still pass, tiao bo? and MAS not forgetting to warn that this is just the beginning .. later might be 50% :tsk-tsk: you cannot drag your loan tenure to lower the monthly servicing due to previous CM, now also cannot rely on "children" to max the loan tenure ... all loopholes closed :beats-me-man:
apply a specified medium-term interest rate or the prevailing market interest rate, whichever is higher, to the property loan that the borrower is applying for when calculating the TDSR;
now the previous calculation is based on SIBOR at 0.4%, now if SIBOR up to 2% (the so called medium-term interest rate), the monthly installment might hit 6k so a TDSR of 60% just sui sui, tiao bo?
apply a haircut of at least 30% to all variable income (e.g. bonuses) and rental income; and
apply haircuts to and amortise the value of any eligible financial assets taken into consideration in assessing the borrower’s debt servicing ability, in order to convert them into ‘income streams’ in computing the TDSR.
Now this is interesting, what it is saying is your 10k pm must be very stable employment, if u are a property agent with variable income or rely on existing property rental then must apply discount of 30% ... so stable monthly income will be ok, not stable finish liao
princess_morbucks
28-06-13, 20:31
If you are a freelance worker, is that considered variable income?
What about businessmen, their income is also variable?
BYE ALL GOOD BROTHERS AND SISTERS, I AM GOING TO ADMIT MYSELF INTO IMH ( INSTITUTE OF MENTAL HEALTH ) LIAO.
GOOD LUCK !
Before you buy property, you sure must have a job and regular income before banks will approve your loan, and they will not factor in the rental income of your yet to be purchase property.
where got... I read that a lot of the people here rents out their properties and use their rental income to sustain the housing loans...
I am pretty sure the banks are lax is checking during loan approval.
Anyway, the policy looks good. On second look, it will not affect the normal property owners much if they are not heavily leveraged. 60% of the income is quite high.
Basically to sustain a 6k housing loan, your income needs to be 10k which is not too bad.
But if you are heavily leveraged with 12k/month housing loan (based on 3.5% interest rate..), your income needs to be 20k and rental income is reduced by 30%.
IF IMH allows me, I will post in this forum from my ward.
GOOD LUCK !
now the previous calculation is based on SIBOR at 0.4%, now if SIBOR up to 2% (the so called medium-term interest rate), the monthly installment might hit 6k so a TDSR of 60% just sui sui, tiao bo?
the medium-term interest rate can be found in MAS website.
3.5% for housing loans
phantom_opera
28-06-13, 20:35
the medium-term interest rate can be found in MAS website.
3.5% for housing loans
hmm .. so that is something like SIBOR=2.5%, margin =1% loh
MM huat ah :rolleyes:
If you are a freelance worker, is that considered variable income?
What about businessmen, their income is also variable?
they don't care about that. What they want to regulate is RENTAL income.... written in black and white
hmm .. so that is something like SIBOR=2.5%, margin =1% loh
MM huat ah :rolleyes:
what talk you?? it is just a number which MAS thinks represent the average interest rate in singapore for medium term...
starrynight
28-06-13, 20:45
Interesting developments. I wonder how strict the banks will be in sighting documents - the paperwork will be a nightmare. For example, my IR8A will only show my last year's fixed and variable income, but if I changed jobs this year, or got a big increment, I'm not sure the bank will spend the time to always calculate my total income correctly. Do I then also have to show them my latest CDP shareholding statement to show dividends, my corporate bond statements, lease agreement to substantiate my rental income?
Will affect people who presently own properties under construction, cos there is no rental income if they want to buy another ppty?
Anyway, in due course, if anyone comes across a calculator for the ratio from any of the property websites, etc., please share!
princess_morbucks
28-06-13, 20:46
they don't care about that. What they want to regulate is RENTAL income.... written in black and white
But they said variable income - so if not fixed income, then it is considered variable, isn't it?
Am i right to say that developers wont care whether you have secured a bank loan or not upon signing of OTP?
CondoInterested
28-06-13, 20:47
Why must apply HAIRCUTS here and HAIRCUTS there?
Already so little hair still wanna cut!!!
Err... I am not referring to my hair. You know who I am referring to!!!
Interesting developments. I wonder how strict the banks will be in sighting documents - the paperwork will be a nightmare. For example, my IR8A will only show my last year's fixed and variable income, but if I changed jobs this year, or got a big increment, I'm not sure the bank will spend the time to always calculate my total income correctly. Do I then also have to show them my latest CDP shareholding statement to show dividends, my corporate bond statements, lease agreement to substantiate my rental income?
If your loan amount is nowhere near the 60%, no need to show so many things right?
Frankly, for most people 60% of the income for housing loan financing is VERY high. Most normal people needs to pay CPF, living expenses, savings, ESPP, etc. How to use 60% for housing loans?
This measure is really targeted at people who use rental income to pay for housing loans...
Can tell that Gov is doing their best to prevent a crash when interest rate eventually rises.
If no CM was implemented, Singaporean will have a really hard time in the near future.
More CM results in softer landing
starrynight
28-06-13, 20:59
That's a good point :)
That said, there are some people like me, who can probably comfortably do 60% (I used to live with my folks, but live overseas now with apartment paid for by company, car paid by company, etc.), so my "running costs" are low, and I'd like to understand that this $ figure is for me.
If your loan amount is nowhere near the 60%, no need to show so many things right?
Frankly, for most people 60% of the income for housing loan financing is VERY high. Most normal people needs to pay CPF, living expenses, savings, ESPP, etc. How to use 60% for housing loans?
This measure is really targeted at people who use rental income to pay for housing loans...
LAI LIAO LOR
I was still telling my dad earlier that J gateway fully sold and there most probably be a measure soon.
BUT....... SO SOON!???
CondoInterested
28-06-13, 21:14
To know if you have constant income, even you throw all your payslips away, I think by logging into your CPF, your can print past 15 months to 5 yrs (I think) transaction which will show your employment's CPF contribution.
phantom_opera
28-06-13, 21:17
Conclusion ...
if you are not cash rich, don't buy investment property
if you lao kok kok with no fixed income, don't buy investment property
if you are salesman/agent, middle class variable income, don't buy investment property
if you are rich or just striked TOTO, welcome ;)
where got... I read that a lot of the people here rents out their properties and use their rental income to sustain the housing loans...
I am pretty sure the banks are lax is checking during loan approval.
Anyway, the policy looks good. On second look, it will not affect the normal property owners much if they are not heavily leveraged. 60% of the income is quite high.
Basically to sustain a 6k housing loan, your income needs to be 10k which is not too bad.
But if you are heavily leveraged with 12k/month housing loan (based on 3.5% interest rate..), your income needs to be 20k and rental income is reduced by 30%.
When you buy a property, how are you going to tell the bank you are collecting rental from it before you even own it, or before its being built?
phantom_opera
28-06-13, 21:29
ok @3.5%, every 333k loan monthly payment is about 1.5k for 30y tenure (assume young enough)
so 1m is about 4.5kpm
so to loan 1m of total housing loans, your gross monthly income must be 7.5k
but if older with 20y loan tenure then monthly payment is 2k for each 333k, so 1m monthly instalment is 6k, you need 10k gross montly income to qualify
ok lah, can still borrow 1m in total mah if int rate used in estimation is 3.5% ... as long as no other loans ... can hoot 2 MMs?
They closed the loophole on borrowing under non-owner name i.e. mortgagor and borrower different person.
Parents cannot take loans off children names liao.
This one will subdue a lot of demand.
proud owner
28-06-13, 21:37
what happens if you secure a loan under the new ruling ...
6 mths later ... you get retrenched ...and unable to find a job for the next 12 mth...
will bank terminate the loan ?
what happens if you secure a loan under the new ruling ...
6 mths later ... you get retrenched ...and unable to find a job for the next 12 mth...
will bank terminate the loan ?
I think this only applies to new loan applications. Those with existing loan will not be affected unless you wish to refinance with other bank
Wah! Those with multiple rental properties are sweating now when time comes for refinancing.:scared-5:
Does it applies only to residential pty? Or commercial pty also?
Wah! Those with multiple rental properties are sweating now when time comes for refinancing.:scared-5:
Does it applies only to residential pty? Or commercial pty also?
I think they mentioned non-residential loan the interest rate is 4.5%
My Mt Sinai dream is facing another setback.
yiguang2001
28-06-13, 21:56
One question,
I signed the OTP today, but obliviously many J Gateway buyers have not sign their loan agreement today. Will we be affected? Or base on our OTP, I can get the old deal.
By the way, I also have Approval in Principle before hand. Wonder if I can be exempted?
Sign~~~~ Was so happy this afternoon.
Does this rule apply to those who rent out their HDB and still servicing the loan? I thought KBW said something like they cannot be too harsh because he knows that lots of people are depending on the rental income for their old age, then now what happen, very "ruan" leh.
At my age, I'm also hoping to use the rental income to service my outstanding loan, what happen if I'm not working anymore, then how? No more rental income to help me support my old age leh, will govt support me or not?:scared-3:
I think this only applies to new loan applications. Those with existing loan will not be affected unless you wish to refinance with other bank
If u sign OTP tonight shd be fine right? Of is it u need to sign Bank Loan offer letter tonight? If need to sign bank loan offer letter, how???? Impossible what!!! Those who sign OTP, bank loan offer takes at least 1 day ba.....
Can someone clarify the 29th June date is for what? OTP or bank offer letter.
If offer letter confirm Jurong Gateway buyers have to return and take a 25% hit:beats-me-man:
My Mt Sinai dream is facing another setback.
:banana: :banana: :banana: ! MTB again..:cheers1: !
any panic selling in the resale yet?
All these thanks to J Gateway!
yiguang2001
28-06-13, 22:05
If u sign OTP tonight shd be fine right? Of is it u need to sign Bank Loan offer letter tonight? If need to sign bank loan offer letter, how???? Impossible what!!! Those who sign OTP, bank loan offer takes at least 1 day ba.....
Can someone clarify the 29th June date is for what? OTP or bank offer letter.
If offer letter confirm Jurong Gateway buyers have to return and take a 25% hit:beats-me-man:
That's the troubling thing. Where do they start applying? OTP or Bank offer. I read the MAS from head to tail many times. Its says new loan. Bloody hell, wording is so vague. My experience friends who survived CM8 says we should be spared. Should be no problem. Want to confirm with my banker but suddenly HPs are all switch off.
princess_morbucks
28-06-13, 22:07
All these thanks to J Gateway!
No lah, how can they just come up with so many rules in a few hours?
These rules must have been well thought of many months ago.
Does this rule apply to those who rent out their HDB and still servicing the loan? I thought KBW said something like they cannot be too harsh because he knows that lots of people are depending on the rental income for their old age, then now what happen, very "ruan" leh.
At my age, I'm also hoping to use the rental income to service my outstanding loan, what happen if I'm not working anymore, then how? No more rental income to help me support my old age leh, will govt support me or not?:scared-3:
dun worry, go and read the MAS FAQ.
http://www.mas.gov.sg/FAQs.aspx
They have considered this group of people. There are very clear cut conditions (owner occupied, single loan, etc) that this new rule will not be applied to. As I have said, it seems that the ruling is targeting multiple property owners who are using rental to cover loan payments.
Q3 Do MAS’ TDSR rules apply to re-financed loans? If so, would this
prevent borrowers from re-financing their loans at lower interest rates,
resulting in financial hardship?
A3 In general, the TDSR rules apply to re-financed loans, but MAS will
exempt existing borrowers that are seeking to re-finance their mortgages if
they are owner-occupiers, and where –
(i) the option to purchase (OTP) the residential property was granted
prior to 29 June 2013;
(ii) the residential property is the only property owned by the
borrower (either by himself or jointly);
(iii) the borrower is one of the occupiers of the residential property;
(iv) the borrower does not have any outstanding loan for the purchase
of any other property or the re-financing of such a loan, apart
from the residential property being re-financed; and
(v) the borrower does not have any outstanding loan (either in his
own name or jointly with another borrower) otherwise secured on
any property, including the residential property being re-financed,
or the re-financing of such a loan.
An FI should obtain documentary evidence to verify (i) to (v).1
That's the troubling thing. Where do they start applying? OTP or Bank offer. I read the MAS from head to tail many times. Its says new loan. Bloody hell, wording is so vague. My experience friends who survived CM8 says we should be spared. Should be no problem. Want to confirm with my banker but suddenly HPs are all switch off.
advice. go read the FAQ on MAS website.
I think it answers your question. I think it applies to you as the start date is for loan application. There is an escape clause for "refinancing" though
That's the troubling thing. Where do they start applying? OTP or Bank offer. I read the MAS from head to tail many times. Its says new loan. Bloody hell, wording is so vague. My experience friends says who survived CM8 says we should be spared. Want to confirm with my banker but suddenly HPs are all switch off.
Seriously if it means u have to sign offer letter by today, many people will die...Just buy JE condo, have to give back and pay 25% of the 5%.....
:banghead:
TO ALL PROPERTY DEVELOPERS...DO NOT MESS WITH THE SG GAHMEN....THEY ALREADY SAY MANY MANY TIMES THAT THEY WILL TAKE ACTION...YET U CHOOSE TO SET THE PRICES SO HIGH...NOW HOW?:doh:
Do MAS’ TDSR rules apply to re-financed loans? If so, would this
prevent borrowers from re-financing their loans at lower interest rates,
resulting in financial hardship?
A3 In general, the TDSR rules apply to re-financed loans, but MAS will
exempt existing borrowers that are seeking to re-finance their mortgages if
they are owner-occupiers, and where –
(i) the option to purchase (OTP) the residential property was granted
prior to 29 June 2013;
(ii) the residential property is the only property owned by the
borrower (either by himself or jointly);
(iii) the borrower is one of the occupiers of the residential property;
(iv) the borrower does not have any outstanding loan for the purchase
of any other property or the re-financing of such a loan, apart
from the residential property being re-financed; and
(v) the borrower does not have any outstanding loan (either in his
own name or jointly with another borrower) otherwise secured on
any property, including the residential property being re-financed,
or the re-financing of such a loan.
No lah, how can they just come up with so many rules in a few hours?
These rules must have been well thought of many months ago.
Yes, the new rules are already prepared.
They are just waiting for the right time to release it!
J Gateway is the stimulus for them to do it.
Crash indeed comes...
It never rob my job, but it kills my Mt Sinai dream.
I will combat and sell off my HDB to raise sufficient cash layout.
I am waiting for fire sales now, especially those 2nd properties and more speculators.
Most of these guidelines are already in place. It doesn't affect foreign banks much. Local banks are affected as they use <3.5%. Hair cut already exist. That's why high network CEO who earn huge bonuses can't use income alone to buy 10m prop. They go for Abl.
Guarantors scheme is redundant now.
This is not harsh. Cm7 is harshest.
All these new rules will just keep the property prices in KL n JB higher n higher....
All these new rules will just keep the property prices in KL n JB higher n higher....
ISKANDAR HUAT AH:cheers3: :cheers2:
yiguang2001
28-06-13, 22:22
advice. go read the FAQ on MAS website.
I think it answers your question. I think it applies to you as the start date is for loan application. There is an escape clause for "refinancing" though
Haha! That is my worst fear.
Haha! That is my worst fear.
Cannot be lah...Then all those people who just buy but not sign offer letter who going to pay their return fee?????:scared-4:
Swee lah....it's time to further stabilize the market.
Crash indeed comes...
It never rob my job, but it kills my Mt Sinai dream.
I will combat and sell off my HDB to raise sufficient cash layout.
I am waiting for fire sales now, especially those 2nd properties and more speculators.
I 4th Liao, u wait for me till next life la...,,, hahaha
I 4th Liao, u wait for me till next life la...,,, hahaha
lets hope you no need to refinance :)
Cannot be lah...Then all those people who just buy but not sign offer letter who going to pay their return fee?????:scared-4:
why return fee??
I think the government thinks that 60% of income is very high... if you read other forums, got people ask who uses more than 60% income for housing loan :)
no need to eat, pay CPF meh? I think PAP thinks majority will have no problem meeting the 60%.
The property in relation to the loan applied for will include both residential and non-residential property (e.g. industrial and commercial property), and will cover property both in and outside of Singapore.
--------
How does MAS enforce the new rules for properties outside of Singapore? Only those taking loans from local banks right?
It is very obvious many do not understand the implication of the new measures. There is a very very obvious implication of what is going to happen but I shall only enlighten you guys after I am discharged from IMH.
Many are shooting on the wrong targets.
:doh:
It is very obvious many do not understand the implication of the new measures. There is a very very obvious implication of what is going to happen but I shall only enlighten you guys after I am discharged from IMH.
Many are shooting on the wrong targets.
:doh:
That's anyhow hantam....:doh:
what happens if you secure a loan under the new ruling ...
6 mths later ... you get retrenched ...and unable to find a job for the next 12 mth...
will bank terminate the loan ?
no the valuation is at the pt of application. unless u not able to repay the loan or u need to re-finaince. then will be problem.
I 4th Liao, u wait for me till next life la...,,, hahaha
I hope you children are capable enough, and you are young enough.
That's anyhow hantam....:doh:
anyhow hamtam ?
let me drop u a hint: Singapore property market is the safest due to the market buy or sell or hold signals all given by our highly regarded government !
now you believe i am wiser than you liao bo ?
as to how and when to take this advantage, i shall not reveal it since you say i anyhow hamtam :( I will only share with my true brothers and sisters via my email. the rest shall remain as novice forever.
woahhahahahhahahhhhehhehehe
why return fee??
I think the government thinks that 60% of income is very high... if you read other forums, got people ask who uses more than 60% income for housing loan :)
no need to eat, pay CPF meh? I think PAP thinks majority will have no problem meeting the 60%.
Many ppl are using the loopholes lei...also many ppl justify their loan application by rental income, bonus etc etc...now those who are strecthed die
Important thing is on the ability to secure the loan. Once loan is approved, LO signed....banks no longer care if you are earning the lesser or get retrench.
Banks will only contact you on your loan on this 2 scenario.
1. You have default your payments for months
2. Valuation of your property dropped more than 20% usually.
no the valuation is at the pt of application. unless u not able to repay the loan or u need to re-finaince. then will be problem.
Majority of property owners will need to re -finance somehow be it for self stay or rented out.
How's the re-financing that will have a serious impact?
Can share your views? Thanks
anyhow hamtam ?
let me drop u a hint: Singapore property market is the safest due to the market buy or sell or hold signals all given by our highly regarded government !
now you believe i am wiser than you liao bo ?
as to how and when to take this advantage, i shall not reveal it since you say i anyhow hamtam :( I will only share with my true brothers and sisters via my email. the rest shall remain as novice forever.
woahhahahahhahahhhhehhehehe
You must be a property agent. :tongue3:
Majority of property owners will need to re -finance somehow be it for self stay or rented out.
How's the re-financing that will have a serious impact?
Can share your views? Thanks
Do MAS’ TDSR rules apply to re-financed loans? If so, would this
prevent borrowers from re-financing their loans at lower interest rates,
resulting in financial hardship?
A3 In general, the TDSR rules apply to re-financed loans, but MAS will
exempt existing borrowers that are seeking to re-finance their mortgages if
they are owner-occupiers, and where –
(i) the option to purchase (OTP) the residential property was granted
prior to 29 June 2013;
(ii) the residential property is the only property owned by the
borrower (either by himself or jointly);
(iii) the borrower is one of the occupiers of the residential property;
(iv) the borrower does not have any outstanding loan for the purchase
of any other property or the re-financing of such a loan, apart
from the residential property being re-financed; and
(v) the borrower does not have any outstanding loan (either in his
own name or jointly with another borrower) otherwise secured on
any property, including the residential property being re-financed,
or the re-financing of such a loan.
Banks will only contact you on your loan on this 2 scenario.
1...
2. Valuation of your property dropped more than 20% usually.
Heard that many committed suicide...some in HK.
Heard that many committed suicide...some in HK.
HK I don't know, but in 2009 lemon bros crisis...when the property valuation dropped, authorities had asked the banks not to ask for top up.
BYE ALL GOOD BROTHERS AND SISTERS, I AM GOING TO ADMIT MYSELF INTO IMH ( INSTITUTE OF MENTAL HEALTH ) LIAO.
GOOD LUCK !
You must be Leo Cheng, a clone nick of his.
I think e govt has mis interpreted e strong sales as bubble. It is more a reflection of trust in govt to deliver e JLD masterplan, pent up upgraders dream n failure of public transport. This rule will favour e rich buyers n increase e gap between rich n middle class.
Personally I like this CM. Too many borderline "investors" already. It's quite dangerous. This only affects the marginal investors, who barely can afford a second investment pty and dream of being a landlord. This is the root cause of all these MMs. Traditionally, pty investment has always been the business of the well off. Now, anyone is dreaming of becoming a landlord with his 200k saving. And unscrupulous developers build units with bite size quantum to suit this. Such situation is not healthy. And such marginal investors are treading a vey dangerous path without knowing it. (rental "yield" is never a sure thing , it's not even a "yield" by definitin. ) Thanks to PAP, gov is now babysitting everything.
For all information...with this new ruling...
No more asset based landing.
In the past, if you are rich and no income, you still can get bank loan to ltv 60% guranteed.
Now, you need income in order to get the loan.
Hence you are unable to levage. Super rich with no income can buy, but pay in full cash.
Is EC affected? Especially in the case of joint borrowers.
Planning to buy an EC
Is EC affected? Especially in the case of joint borrowers.
Planning to buy an EC
Yes...100%
It's for any type of residential property purchase.
Hence you are unable to levage. Super rich with no income can buy, but pay in full cash.
The rich has many ways of getting a loan. It doesn't have to be a mortgage.
For all information...with this new ruling...
No more asset based landing.
In the past, if you are rich and no income, you still can get bank loan to ltv 60% guranteed.
Now, you need income in order to get the loan.
Hence you are unable to levage. Super rich with no income can buy, but pay in full cash.
Again, u missed the target.
The super rich have been using asset leverage for donkey years. This time they will just bypass the landed here.
U are right, some call me Leo, others call me Blackjack21
Personally I like this CM. Too many borderline "investors" already. It's quite dangerous. This only affects the marginal investors, who barely can afford a second investment pty and dream of being a landlord. This is the root cause of all these MMs. Traditionally, pty investment has always been the business of the well off. Now, anyone is dreaming of becoming a landlord with his 200k saving. And unscrupulous developers build units with bite size quantum to suit this. Such situation is not healthy. And such marginal investors are treading a vey dangerous path without knowing it. (rental "yield" is never a sure thing , it's not even a "yield" by definitin. ) Thanks to PAP, gov is now babysitting everything.
Agree. It will be more effective for MND to lay down minimum unit sizes and kill off these shoeboxes once and for all. :D
The rich has many ways of getting a loan. It doesn't have to be a mortgage.
Definitely, but in this context...I am referring to residential property loan with regards to this new ruling.
Definitely, but in this context...I am referring to residential property loan with regards to this new ruling.
All official media sources say this is not a CM, merely framework development
Again, u missed the target.
The super rich have been using asset leverage for donkey years. This time they will just bypass the landed here.
U are right, some call me Leo, others call my Blackjack21
Haha...bingo....I know you are super handsome too. :cheers6:
Agree. It will be more effective for MND to lay down minimum unit sizes and kill off these shoeboxes once and for all. :D
MAI HAI LANG LA !!!!
All official media sources say this is not a CM, merely framework development
I never say is new CM, I only say is new ruling. :doh:
Please go channelnewsasia website.
It states, "MAS set new rules" :cheers6:
Agree. It will be more effective for MND to lay down minimum unit sizes and kill off these shoeboxes once and for all. :D
I agree :D
I never say is new CM, I only say is new ruling. :doh:
I never say you say CM..... I just point out all official media says its not CM.
All official media sources say this is not a CM, merely framework development
NI GONG SIMI ? ( what talking you ? )
This is the arrow shooting right into the heart of the apple.
I have a gut feeling something else is coming, but I am just not smart enough to know what and how they are going to do it.
hence, my appeals to developers here not to be so haolian.
now see what happen liao lor... That is why I said go for CCR also.
But many laugh at me lor :(
Yes...100%
It's for any type of residential property purchase.
What does this mean?
Q8 The computation of the TDSR should aggregate the monthly
repayments of total debt obligations. Are there any exceptions to this rule?
A8 In the case of a borrower applying for a loan for the purchase of a HDB
flat or an Executive Condominium (EC) purchased directly from a property
developer, an FI may exclude the monthly repayment in respect of the
borrower’s outstanding loan for an existing residential property, in computing
the TDSR for the HDB flat or EC. This exemption takes into account HDB’s
current rules on ownership, which require buyers of HDB flats or ECs
purchased directly from a property developer to sell their existing properties
within six months of TOP/CSC of the EC or taking possession of the HDB flat. In
such cases, the existing residential property and loan for the property, would
be sold off and discharged within six months.
This exemption will only apply where the borrower has, at the time of applying
for such a loan –
(i) only one existing residential property that he owns, either by
himself or jointly, and which he will be taking steps to sell;
(ii) an outstanding loan for the purchase of the existing residential
property or the re-financing of such a loan;
(iii) no outstanding loan (either in his own name or jointly with
another borrower) for the purchase of property or the re-financing
of such a loan, apart from the loan in (ii);
(iv) no outstanding loan (either in his own name or jointly with
another borrower) otherwise secured on any property, including the property referred to in (i), or the re-financing of such a loan;
and
(v) no property other than the property referred to in (i) that he
owns, either by himself or jointly.
An FI should obtain documentary evidence to verify (i) to (v). 2
This exemption will also apply to the computation for the MSR of 30%, of
borrowers applying for a loan for the purchase of a HDB flat.
Haha...bingo....I know you are super handsome too. :cheers6:
U praise me like that I have to say ur eyes stuck with stamps lor.
Woahahahhehhehhehehheh
NI GONG SIMI ? ( what talking you ? )
This is the arrow shooting right into the heart of the apple.
I have a gut feeling something else is coming, but I am just not smart enough to know what and how they are going to do it.
hence, my appeals to developers here not to be so haolian.
now see what happen liao lor... That is why I said go for CCR also.
But many laugh at me lor :(
Brother I never say this...official media CNA say one...I also like you worried for the future....
I never say you say CM..... I just point out all official media says its not CM.
Haha....by getting banks to do credit tightening on individuals, this is definitely part of the Cooling measures to cool the property market
The above is a 100% correct statement.
U praise me like that I have to say ur eyes stuck with stamps lor.
Woahahahhehhehhehehheh
That is not what I said, that is what blackjack always love to say.
I am just quoting his words. :cheers6:
Haha....by getting banks to do credit tightening on individuals, this is definitely part of the Cooling measures to cool the property market
The above is a 100% correct statement.
I agree brother:(
Brother I never say this...official media CNA say one...I also like you worried for the future....
Just bear with it lor... What can we do tiobo? Next time just ask the developers u meet not to be so haolian and earn money quiet quiet earn can already :(
Brother I never say this...official media CNA say one...I also like you worried for the future....
Haha...Leo Cheng is a super rich man living next to Singapore river.
He is definitely not worry about his future.
That is not what I said, that is what blackjack always love to say.
I am just quoting his words. :cheers6:
Cannot believe u can quote a siaolang like blackjack. I am the saner part in him lor. LOL anyway, I agree with you la... Just teasing u only lor
Woahahahhhhhehhehehehhe
Just bear with it lor... What can we do tiobo? Next time just ask the developers u meet not to be so haolian and earn money quiet quiet earn can already :(
Pppl also to be blamed...if developer set price, they all think wah must be a bargain even if they pay $1600 for Jurong.....two hands to clap:witches-brew:
Haha....by getting banks to do credit tightening on individuals, this is definitely part of the Cooling measures to cool the property market
The above is a 100% correct statement.
You are right. This is called CREDIT TIGHTENING. Now u are shooting correctly.
Haha...Leo Cheng is a super rich man living next to Singapore river.
He is definitely not worry about his future.
Of course I never worry, anything I can just jump into the river lor :(
Pppl also to be blamed...if developer set price, they all think wah must be a bargain even if they pay $1600 for Jurong.....two hands to clap:witches-brew:
Importantly, we also need to look at the govt land sales. What is the bidding price.
If developer bid price is at 700psf in Punggol , what will the break even cost?
1300psf? Then how much do you think developer will sell to make profit?
You are right. This is called CREDIT TIGHTENING. Now u are shooting correctly.
Haha, it's a matter of focus....sometime lose focus will be bobo shooter. :cheers6:
Importantly, we also need to look at the govt land sales. What is the bidding price.
If developer bid price is at 700psf in Punggol , what will the break even cost?
1300psf? Then how much do you think developer will sell to make profit?
If they bid $700 psf for punggol....:doh:
Pppl also to be blamed...if developer set price, they all think wah must be a bargain even if they pay $1600 for Jurong.....two hands to clap:witches-brew:
That is why from the first CM, I ask never go on the media to boast about what property lucrative returns and what have you lor... But those ppl every week must go on Sunday times to say how successful they are in property investment!
What is income-weighted average age and how is it calculated??
If they bid $700 psf for punggol....:doh:
In Sengkang west ...an ulu place...UOL bidder 600+psf if I remember correctly.
What is income-weighted average age and how is it calculated??
E.g 30 + 60...average age is 45.
Max tenor is 20yrs
Importantly, we also need to look at the govt land sales. What is the bidding price.
If developer bid price is at 700psf in Punggol , what will the break even cost?
1300psf? Then how much do you think developer will sell to make profit?
This is another key area. Good point u brought up, I have been thinking about this recently actually.
That is why from the first CM, I ask never go on the media to boast about what property lucrative returns and what have you lor... But those ppl every week must go on Sunday times to say how successful they are in property investment!
:doh: This is call show off..They never learn from Sun Tzu:doh:
"Be extremely subtle, even to the point of formlessness. Be extremely mysterious, even to the point of soundlessness. Thereby you can be the director of the opponent's fate."
"All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved."
This is another key area. Good point u brought up, I have been thinking about this recently actually.
Haha...don't need to think so much lah...think simple.
Why gls land at such ulu price can fetch rocket high price?
Rich ar...our zheng hu...
E.g 30 + 60...average age is 45.
Max tenor is 20yrs
Thanks. Then why said income-weighted average age? Just said average can liao. Confuse pp leh.
proud owner
29-06-13, 00:04
E.g 30 + 60...average age is 45.
Max tenor is 20yrs
hor sei leow
my wife is 10 yrs younger than me ... and we have never taken any loan more than 20 yrs....
Thanks. Then why said income-weighted average age? Just said average can liao. Confuse pp leh.
I think it is more than average. The age is affected by the disparity in incomes as well. If the older person earns more, the age will be higher. Vice versa.
Please correct if I am wrong.
proud owner
29-06-13, 00:06
That is why from the first CM, I ask never go on the media to boast about what property lucrative returns and what have you lor... But those ppl every week must go on Sunday times to say how successful they are in property investment!
exactly ... I cannot stand those write ups ...
super how lian ....
sunday times shud also do a follow up .. re interview them 2 to 3 yrs later and see how these interviewees are doing ...
I think it is more than average. The age is affected by the disparity in incomes as well. If the older person earns more, the age will be higher. Vice versa.
Please correct if I am wrong.
Got any examples?
Don't understand leh
All the CMs including the latest will benefit only one group of buyers: those first time buyer looking for owner occupied units.
Why I say units is because landed buyers usually have more than 1 properties, as such, they will not be buying anymore landed liao. That is why I reiterate private condo and HDB will remain healthy while certain class of landed will crash more than 30%.
A few months ago I said this, and some say i talk cork and against me profusely. Now u believe my third eye liao bo?
E.g 30 + 60...average age is 45.
Max tenor is 20yrs
No.
60 yr old income 10k, 30yr old income 0, income weighted age is 60.
60 yr old income 10k, 30yr old income 5k, income weighted age is 50
Get the idea ? Simple math.
(60 * 10 + 30 * 5) / (10 + 5) = 50
All the younger generations never listen to old uncles like me anymore...sigh.....
Got any examples?
Don't understand leh
Clarity will come in next few days from mas and banks. My bankers are waiting to be briefed.
Can't term it as CM as someone had mentioned not too long ago that there's no more CM!
No.
60 yr old income 10k, 30yr old income 0, income weighted age is 60. Get the idea ? Simple math.
What if 30yr make 3k?
No.
60 yr old income 10k, 30yr old income 0, income weighted age is 60. Get the idea ? Simple math.
Errr.. But 60 years cannot borrow very long tiobo? So 30 should be the max without the weights...I also confused leh :(
:scared-3::banghead:
Tharman thinks he's very smart when actually he is over micro-managing the market, probably with eventual bad results
Can't term it as CM as someone had mentioned not too long ago that there's no more CM!
U r right. It's merely a framework for banks to adhere to and some action items to close loop holes like the guarantor.
If anyone can't sleep over this, then u might be over leveraged.
Sigh.. You have to admit THARMAN is indeed a genius. I warned all the property developers way way ahead not to mess with him or Ah Khaw. But instead of heeding my advice, they purposely go against me lor :(
U r right. It's merely a framework for banks to adhere to and some action items to close loop holes like the guarantor.
If anyone can't sleep over this, then u might be over leveraged.
I cannot sleep over this. Hope after the brother's bankers are briefed, I can sleep better lor. Do not misunderstand, I worry for the developers.
Like the lemon brother brought up. There are still a few target area that can be frame worked. So good luck.
What if 30yr make 3k?
(60 * 10 + 30 * 3) / ( 10 + 3 )
That is why you all must have hair cut mah!
Why must apply HAIRCUTS here and HAIRCUTS there?
Already so little hair still wanna cut!!!
Err... I am not referring to my hair. You know who I am referring to!!!
Like the lemon brother brought up. There are still a few target area that can be frame worked. So good luck.
Haha...heng ar...I got 2 fully paid property and 1 under mortgage.
No impact on me. :tongue3:
(60 * 10 + 30 * 3) / ( 10 + 3 )
So according to your formula, the previous example is :
600+0 / 10 = 60 ? How can 60 years old borrow for 60 years? Pls enlighten :)
Haha...heng ar...I got 2 fully paid property and 1 under mortgage.
No impact on me. :tongue3:
You good lor, win liao lor. I am not over leveraged, but very borderline ! But I still worry lor :( not for the current CM, but for something else which I hope they missed.
Woahahahhahahahahhahah
So according to your formula, the previous example is :
600+0 / 10 = 60 ? How can 60 years old borrow for 60 years? Pls enlighten :)
Alamak this number is the derived "income weighted age", I.e. such joint applicants are treated as age 60.
Alamak this number is the derived "income weighted age", I.e. such joint applicants are treated as age 60.
Sigh yo.....you should go MAS lah... Now I understand liao LOL
You guys wanna know what is the next thing I scared of. That is, the policy I hope they missed out? Hehhehehhhehhhhh see you guys smart or not.
You guys wanna know what is the next thing I scared of. That is, the policy I hope they missed out? Hehhehehhhehhhhh see you guys smart or not.
Hint: this one har, the angmo government or USA very good at one lor...hehehehhehehehhehehehehhe not QE hor!
Hint: this one har, the angmo government or USA very good at one lor...hehehehhehehehhehehehehhe not QE hor!
Hehehehehehe
Hehehehehehe
Those know dun say here hor.heheheheheheheh not interest rates hor....
Those know dun say here hor.heheheheheheheh not interest rates hor....
Hint : This one has the same initials as our previous Prime Minister hor....heheheheheh
This new cooling measure will make it harder for people to buy back after selling. Less people will be selling.
This new cooling measure will make it harder for people to buy back after selling. Less people will be selling.
Hey ! U r right ! Why didn't I see that. Good thinking :)
proud owner
29-06-13, 00:45
Hint : This one has the same initials as our previous Prime Minister hor....heheheheheh
I know in US income from home ownership , be in capital gain, rental income etc ..are not taxed as much as profit and dividends from stocks ...
resulting in a lot of investments in real property ... and partly contributed to subprime
is this something you are thinking of ?
LAI LIAO LOR
I was still telling my dad earlier that J gateway fully sold and there most probably be a measure soon.
BUT....... SO SOON!???
Because some R said Khaw will lim Kopi with Sham while reading condosingapore.
princess_morbucks
29-06-13, 00:48
Lion king, I can't sleep without knowing the answer to your riddle.
Is it General Consumption Tax?- whatever that is.
or maybe Goods Consumption Tax?
Autumnwinds
29-06-13, 00:50
Genuine question, do people really take up to 60% installment??
I'd consider that over stretching. And I remember that even 50% of total gross income is considered risky, and banks are not as lenient before in granting loans.
Hint : This one has the same initials as our previous Prime Minister hor....heheheheheh
But it's pro business sg govt
http://en.wikipedia.org/wiki/Capital_gains_tax_in_the_United_States
To know the real impact of this measure, one must know the existing bank policies and usual practices when they give out housing loans.
If banks have already been adhering to similarly strict policies or practices, say they use medium rate of 3% (slightly less than this time round's 3.5%) to calculate TDSR, then the impact would be minimal.
If banks have been too lax before, then there will be some impact.
We need forumers who just took loans in recent years and who have been able to understand how banks assess his TDSR and his eligibility, to contribute here, in order to gauge the impact. This is how a forum can really help.
princess_morbucks
29-06-13, 00:53
http://en.wikipedia.org/wiki/Capital_gains_tax_in_the_United_States
That's capital gain tax !
You gave yourself credit. Thanks
FINALLY.
borrowers named on a property loan to be the mortgagors of the residential property for which the loan is taken;
“guarantors” who are standing guarantee for borrowers otherwise assessed by the FI at the point of application for the housing loan not to meet the TDSR threshold for a property loan to be brought in as co-borrowers; and
in the case of joint borrowers, that FIs use the income-weighted average age of borrowers7 when applying the rules on loan tenure.
Would you believe I actually spent like close to an hour some months back talking to some MAS officer on the phone, explaining to them the average age problem.
The stupid officer still keep trying to defend it and they say the banks will use the "proper" age and they will monitor it.
I was like, duh.... all these measures are in place because the banks cannot be trusted to be prudent. Given clinching a business, they will try to sell the loan by using the youngest age of the borrowers.
I told them specifically that they have to use the income weighted average age so it is CLEAR CUT. why make it so ambiguous???
That's capital gain tax !
It is targeted at specific income brackets if u read wiki carefully. Very scary hor!
To know the real impact of this measure, one must know the existing bank policies and usual practices when they give out housing loans.
If banks have already been adhering to similarly strict policies or practices, say they use medium rate of 3% (slightly less than this time round's 3.5%) to calculate TDSR, then the impact would be minimal.
If banks have been too lax before, then there will be some impact.
We need forumers who just took loans in recent years and who have been able to understand how banks assess his TDSR and his eligibility, to contribute here, in order to gauge the impact. This is how a forum can really help.
I second that. Good call :)
Because some R said Khaw will lim Kopi with Sham while reading condosingapore.
Lol....u must be joking.. Funny.
Currently Active Users: 2355 (157 members and 2198 guests)
Most users ever online was 13,691, 12th January 2013 at 01:01 AM.
Judging from the above number, this CM is not as strong.
princess_morbucks
29-06-13, 01:01
Currently Active Users: 2355 (157 members and 2198 guests)
Most users ever online was 13,691, 12th January 2013 at 01:01 AM.
Judging from the above number, this CM is not as strong.
People still on vacation?
Or system not detecting properly?
Impact is limited to Jurong East only?
But it's pro business sg govt
That I agree. That is why I think the chances of it happening is low, but if happens it can impact me the most due to inheritance :(
My personal feel is that it doesn't differ much from the current practice. Why? this is because MAS has been talking with banks since a few months ago, and MAS, as a regulator, wouldn't want to kill banks' business, MAS couldn't even afford the new loans to show year-on-year declines.
I'm not sure about the current practice as banks never question me when I took loans, however, my guess is that they didn't have a standardized framework to assess TDSR for all loans using 3.5%, what banks did were perhaps only looking at individual mortgage loans, applying a rate like 2.5% or 3%, they probably applied some haircuts to rental too, and banks are no-idiot, while they have been loose in the above, they probably applied a stricter and lower ratio for this individual mortgage service ratio, probably in the region of 40% to 50%. What MAS did was really to standardize it, and probably when MAS helped setup this new TDSR framework, they already took a survey of existing loan applicants, and found that some 95% of applicants satisfy the new TDSR framework, and only then they can launch the new framework.
I second that. Good call :)
Quote:
Originally Posted by economist
To know the real impact of this measure, one must know the existing bank policies and usual practices when they give out housing loans.
If banks have already been adhering to similarly strict policies or practices, say they use medium rate of 3% (slightly less than this time round's 3.5%) to calculate TDSR, then the impact would be minimal.
If banks have been too lax before, then there will be some impact.
We need forumers who just took loans in recent years and who have been able to understand how banks assess his TDSR and his eligibility, to contribute here, in order to gauge the impact. This is how a forum can really help.
This CM will cool the market a bit but the real demand will still be there.
Hmmm ... Not sure if policy makers did see our posts here? Remember some weeks back we were talking abt what is happening the showflats with youngsters buying condos like a Prada bag (parents pay)?
Think maybe policy makers saw such posts??!!
Maybe from now on should refrain from posting real time happenings in the showflats!!
Anyway... 60% is a joke la ... I can't reveal what is the joke ... U all have to figure it out here...
No wonder my Mentor writes in codes... Now I understand ... To avoid detection by some policy makers...
DKSG
My personal feel is that it doesn't differ much from the current practice. Why? this is because MAS has been talking with banks since a few months ago, and MAS, as a regulator, wouldn't want to kill banks' business, MAS couldn't even afford the new loans to show year-on-year declines.
I'm not sure about the current practice as banks never question me when I took loans, however, my guess is that they didn't have a standardized framework to assess TDSR for all loans using 3.5%, what banks did were perhaps only looking at individual mortgage loans, applying a rate like 2.5% or 3%, they probably applied some haircuts to rental too, and banks are no-idiot, while they have been loose in the above, they probably applied a stricter and lower ratio for this individual mortgage service ratio, probably in the region of 40% to 50%. What MAS did was really to standardize it, and probably when MAS helped setup this new TDSR framework, they already took a survey of existing loan applicants, and found that some 95% of applicants satisfy the new TDSR framework, and only then they can launch the new framework.
Quote:
Originally Posted by economist
To know the real impact of this measure, one must know the existing bank policies and usual practices when they give out housing loans.
If banks have already been adhering to similarly strict policies or practices, say they use medium rate of 3% (slightly less than this time round's 3.5%) to calculate TDSR, then the impact would be minimal.
If banks have been too lax before, then there will be some impact.
We need forumers who just took loans in recent years and who have been able to understand how banks assess his TDSR and his eligibility, to contribute here, in order to gauge the impact. This is how a forum can really help.
I have to say u r a very good thinker. It is very logical to think of it like you do:)
This CM will cool the market a bit but the real demand will still be there.
Hmmm ... Not sure if policy makers did see our posts here? Remember some weeks back we were talking abt what is happening the showflats with youngsters buying condos like a Prada bag (parents pay)?
Think maybe policy makers saw such posts??!!
Maybe from now on should refrain from posting real time happenings in the showflats!!
Anyway............
DKSG
Good brother buay koon like me ARH ? ( cannot sleep after the latest news)
I have to say u r a very good thinker. It is very logical to think of it like you do:)
thank you, but everyone is thinking here, thinking especially hard after every CM to guage its impact, aren't we?
Shall not say much but you are pretty good
This CM will cool the market a bit but the real demand will still be there.
Hmmm ... Not sure if policy makers did see our posts here? Remember some weeks back we were talking abt what is happening the showflats with youngsters buying condos like a Prada bag (parents pay)?
Think maybe policy makers saw such posts??!!
Maybe from now on should refrain from posting real time happenings in the showflats!!
Anyway... 60% is a joke la ... I can't reveal what is the joke ... U all have to figure it out here...
No wonder my Mentor writes in codes... Now I understand ... To avoid detection by some policy makers...
DKSG
This new ruling will have impact on
1) People who wishes to buy property via wife children siblings, parents
2) People who wishes to buy property via asset based lending
3) People who wishes to max out loan to buy large quantum properties, such as landed.
proud owner
29-06-13, 01:19
It is targeted at specific income brackets if u read wiki carefully. Very scary hor!
so I was partially correct lah ...
cos housing is a necessity .. and gain ... is less than profit/gain in stocks..
so they tax more on people making money from equities ...and less on real property
This new ruling will have impact on
1) People who wishes to buy property via wife children siblings, parents
2) People who wishes to buy property via asset based lending
3) People who wishes to max out loan to buy large quantum properties, such as landed.
Woahahaahhahahahhahahahha..... Do u have to be so clear?
Yes the standardisation is finally here. At least MAS is doing their job.
My personal feel is that it doesn't differ much from the current practice. Why? this is because MAS has been talking with banks since a few months ago, and MAS, as a regulator, wouldn't want to kill banks' business, MAS couldn't even afford the new loans to show year-on-year declines.
I'm not sure about the current practice as banks never question me when I took loans, however, my guess is that they didn't have a standardized framework to assess TDSR for all loans using 3.5%, what banks did were perhaps only looking at individual mortgage loans, applying a rate like 2.5% or 3%, they probably applied some haircuts to rental too, and banks are no-idiot, while they have been loose in the above, they probably applied a stricter and lower ratio for this individual mortgage service ratio, probably in the region of 40% to 50%. What MAS did was really to standardize it, and probably when MAS helped setup this new TDSR framework, they already took a survey of existing loan applicants, and found that some 95% of applicants satisfy the new TDSR framework, and only then they can launch the new framework.
Quote:
Originally Posted by economist
To know the real impact of this measure, one must know the existing bank policies and usual practices when they give out housing loans.
If banks have already been adhering to similarly strict policies or practices, say they use medium rate of 3% (slightly less than this time round's 3.5%) to calculate TDSR, then the impact would be minimal.
If banks have been too lax before, then there will be some impact.
We need forumers who just took loans in recent years and who have been able to understand how banks assess his TDSR and his eligibility, to contribute here, in order to gauge the impact. This is how a forum can really help.
Woahahaahhahahahhahahahha..... Do u have to be so clear?
R is always very direct. I'm scared of him.
so I was partially correct lah ...
cos housing is a necessity .. and gain ... is less than profit/gain in stocks..
so they tax more on people making money from equities ...and less on real property
No, u are fully correct to say that.
The capital gains in us was applied to income brackets of more than $40,000.
the subprime resulted from the lower brackets or households with lower income like $8000 which are not taxed on capital gains.
R is always very direct. I'm scared of him.
Me too lol
This new ruling will have impact on
1) People who wishes to buy property via wife children siblings, parents
2) People who wishes to buy property via asset based lending
3) People who wishes to max out loan to buy large quantum properties, such as landed.
And the question is, how many percentage of potential buyers belong to these three categories? If it is just 5%, the impact would be limited, if it is 20%, the impact would be felt.
Yes the standardisation is finally here. At least MAS is doing their job.
Even credit risk management now also Kenna standardized by MAS!
Banks can now reduce the number of head counts in credit risk dept, hmmm ... Is that the dept yowetan is working in ??!!
DKSG
And the question is, how many percentage of potential buyers belong to these three categories? If it is just 5%, the impact would be limited, if it is 20%, the impact would be felt.
Gut feel is below 20 but close. Impact will be felt. K n S can sleep soundly.
And the question is, how many percentage of potential buyers belong to these three categories? If it is just 5%, the impact would be limited, if it is 20%, the impact would be felt.
In the past few months, if you have spoken to Barbarella, Leticia or Lulu, you will know this percentage is confirm more than 5%...
The rest cannot say more lo!
DKSG
Even credit risk management now also Kenna standardized by MAS!
Banks can now reduce the number of head counts in credit risk dept, hmmm ... Is that the dept yowetan is working in ??!!
DKSG
He ah. I have a feeling that T created this framework for him (his character at least).
http://s2.lemde.fr/image/2011/05/19/600x300/1524337_3_438e_tharman-shanmugaratnam.jpg
Anyone knows how to read palm fortune?
And the question is, how many percentage of potential buyers belong to these three categories? If it is just 5%, the impact would be limited, if it is 20%, the impact would be felt.
depend which segment of the market. For mass market, I think the impact will be negligible because quantum is small and buyers are generally younger, hence can take a longer loan.
For big quantum property like landed or luxury apartment, the impact might be greater because the profile of such buyer are generally older.
But this cooling measure should not affect the market too much.
Actually, this is really a good policy, imagine if SIBOR does go to 2-2.5%, and mortgage rate therefore goes to 3.5%, those people who find themselves paying 60% of income as debt services probably shouldn't have bought the house in the first place. Therefore, it is good to stablise the market and prevent from forced selling in the future.
This should actually be CM1, not CM8.
depend which segment of the market. For mass market, I think the impact will be negligible because quantum is small and buyers are generally younger, hence can take a longer loan.
For big quantum property like landed or luxury apartment, the impact might be greater because the profile of such buyer are generally older.
But this cooling measure should not affect the market too much.
Again ... If u have been to the showflats you will know that the opposite if true ...
Mass market is flooded with youngsters and sons and daughters of cheongsters uncles!
Lux market are dominated by rich foreigners who doesn't give a hoot (except that they really hoot)... About LTV ... To them money in Sg is the safest compared to their other choices..
Again, Office Boy can't say too much ...
DKSG
Again ... If u have been to the showflats you will know that the opposite if true ...
Mass market is flooded with youngsters and sons and daughters of cheongsters uncles!
Lux market are dominated by rich foreigners who doesn't give a hoot (except that they really hoot)... About LTV ... To them money in Sg is the safest compared to their other choices..
Again, Office Boy can't say too much ...
DKSG
you could be right. but I think this new ruling will only further drive more marginalized buyer towards OCR property.
you could be right. but I think this new ruling will only further drive more marginalized buyer towards OCR property.
We will know in 12 hours time when a CCR condo is soft launched ...
If the results is like 50% sold on first day, then we know that the OCR enthusiasm is spilling into the CCR.
It doesn't take genius to decide that buying a FH CCR studio at $2,000 psf is a much better deal that a Jurong 99LH for $1,800 psf?
DKSG
We will know in 12 hours time when a CCR condo is soft launched ...
If the results is like 50% sold on first day, then we know that the OCR enthusiasm is spilling into the CCR.
It doesn't take genius to decide that buying a FH CCR studio at $2,000 psf is a much better deal that a Jurong 99LH for $1,800 psf?
DKSG
which CCR condo may i ask ? now need to monitor personally liao :(
which CCR condo may i ask ? now need to monitor personally liao :(
Monitor or go and Hoot one unit ??!!
One Bal-moral ...
DKSG
It doesn't take genius to decide that buying a FH CCR studio at $2,000 psf is a much better deal that a Jurong 99LH for $1,800 psf?
DKSG
no right or wrong answer here. Some prefer to be a big fish in a small pond, while others dont mine being a small fish in the big pond.
Having said that, Belmoral area has never been popular place for rental or 1 bedder apartment. Perhaps the lack of singles community for social gathering is making the place less popular among 1 bedder tenant.
Monitor or go and Hoot one unit ??!!
One Bal-moral ...
DKSG
monitor only la. i want to see how the real reaction like u suggested.
1 balmoral. any bet on the take up rate? :cheers1:
no right or wrong answer here. Some prefer to be a big fish in a small pond, while others dont mine being a small fish in the big pond.
Having said that, Belmoral area has never been popular place for rental or 1 bedder apartment. Perhaps the lack of singles community for social gathering is making the place less popular among 1 bedder tenant.
but balmoral can walk to Orchard leh. I think the Jewel@Balmoral behind the hill can walk to Shaw Plaza tiobo ?
no right or wrong answer here. Some prefer to be a big fish in a small pond, while others dont mine being a small fish in the big pond.
Having said that, Belmoral area has never been popular place for rental or 1 bedder apartment. Perhaps the lack of singles community for social gathering is making the place less popular among 1 bedder tenant.
resale 3br 2.2m 4.5-5k rental.
then again, this area has a lack of 1br.. but anw ccr should continue to be quiet...........
but balmoral can walk to Orchard leh. I think the Jewel@Balmoral behind the hill can walk to Shaw Plaza tiobo ?
bro u walk and tell me can or not? and if u can walk back to jewel, i treat u massage.
Please share your observations tomorrow, sure many are curious.
My feel regarding the percentage of buyers affected could be around 10%, which means minimal impact, and maybe easily offset by the usual sentiment of -- would one more CM come and would it make buying more difficult?
We can laugh at this sentiment, but I always feel that sentiment is more of a deciding factor in property market. However laughable, if it is real, then it is something so we shall observe.
Please share your observations tomorrow, sure many are curious.
My feel regarding the percentage of buyers affected could be around 10%, which means minimal impact, and maybe easily offset by the usual sentiment of -- would one more CM come and would it make buying more difficult?
We can laugh at this sentiment, but I always feel that sentiment is more of a deciding factor in property market. However laughable, if it is real, then it is something so we shall observe.
Wah! Now u all are sounding like my Bosses leh ... I bobian have to go that showflat tomorrow arh ???
Very pai tan ...
DKSG
Wah! Now u all are sounding like my Bosses leh ... I bobian have to go that showflat tomorrow arh ???
Very pai tan ...
DKSG
Haha, that's because you are the most hard working one here...
resale 3br 2.2m 4.5-5k rental.
then again, this area has a lack of 1br.. but anw ccr should continue to be quiet...........
Yield is a bit low...
bro u walk and tell me can or not? and if u can walk back to jewel, i treat u massage.
maybe because I drive regularly in that area that is why I feel it is very near Orchard.
One end of Balmoral ends at Balmoral Plaza in Bukit Timah, the other end runs all the way from Stevens Road to Raffles Girls to Balmoral Hill and Ardmore Park tiobo ? So this One-Blamoral should be the nearer to Orchard or Bukit Timah?
maybe because I drive regularly in that area that is why I feel it is very near Orchard.
One end of Balmoral ends at Balmoral Plaza in Bukit Timah, the other end runs all the way from Stevens Road to Raffles Girls to Balmoral Hill and Ardmore Park tiobo ? So this One-Blamoral should be the nearer to Orchard or Bukit Timah?
just checked. It is nearer to RGS which I will try tomm see if can walk along Shangri-La Hotel secret lane to Orchard bo. You see, I child that time very good at playing hide and seek in that place cause grandfather business is in that area lor.
Please share your observations tomorrow, sure many are curious.
My feel regarding the percentage of buyers affected could be around 10%, which means minimal impact, and maybe easily offset by the usual sentiment of -- would one more CM come and would it make buying more difficult?
We can laugh at this sentiment, but I always feel that sentiment is more of a deciding factor in property market. However laughable, if it is real, then it is something so we shall observe.
KBW already say cannot fight sentiments, after so many CM still like that , sold out in 1 day. All uncles come out and DP for children and let their children carry the installment.
most hdb bought in the early 1990s must be mostly paid finish already. This group of "starving" and burned(post leman) syndrome uncles & aunties come out in full force is clearly demonstrated in OCR region run-ups.
There is no discussion of PSF price for them. There is only 1 line this group look at, how much month installment? After CPF cash outlay how much. Dont worry, if i cannot pay, i rent out is their mentality.
There is no stopping them in my opinion. If someone have not seen ghost, he will not be scare of the dark, no mater how vividly our government try to paint how scary a ghost look like.
But all in all, if the tap is continue to be open and PAPs continue to do what they are best at, this boat might not be silly decision after all. However if all the mindless PAP bashers on the web get their way, we all get to sink together in this little hot spot.
just checked. It is nearer to RGS which I will try tomm see if can walk along Shangri-La Hotel secret lane to Orchard bo. You see, I child that time very good at playing hide and seek in that place cause grandfather business is in that area lor.
Looking at the streetdirectory, I think I am right. But can only confirm tomm.
This is my secret path:
1) From One-Balmoral cross road quickly to RGS.
2) Walk outside the perimeter of RGS, and remind myself DO NOT ENTER the school !
3) I should see an overhead bridge I think now still there, go along Steven Road only shortly and I shall see the roof of Shangri-la Hotel above the trees.
4) Just walk in that direction.
5) When I reach the gates of the hotel, I shall cut across the outside carpark around a taxi control station opposite of Orchard Hotel.
6) Then just walk towards Shaw House.
Hope that should take around 30 mins on foot.
Ok! LionKing go showflat and report back here ok?
Office Boy try to go also.
I told one of my nicer office colleague to buy this one, tomorrow confirm got one unit sold!!!
DKSG
Ok! LionKing go showflat and report back here ok?
Office Boy try to go also.
I told one of my nicer office colleague to buy this one, tomorrow confirm got one unit sold!!!
DKSG
I think I will use Draycott lane after viewing , will be even faster reach Shaw House from the map, avoiding RGS altogether!
I think I will use Draycott lane after viewing , will be even faster reach Shaw House from the map, avoiding RGS altogether!
U can safely walk RGS, no young school girls around... School holidays now ....
DKSG
puffer_fish
29-06-13, 02:50
wow....happening sia
when back, will go, see if any good pickings :ashamed1:
can someone help me understand, this round cooling measures seems to just state officially what the banks have been implementing and the loan tenure is switch from youngest to older applicant age?:beats-me-man:
http://www.mas.gov.sg/News-and-Publications/Press-Releases/2013/MAS-Introduces-Debt-Servicing-Framework-for-Property-Loans.aspx
Parents will find it difficult to buy properties for their children. So this rule will favour rich parents n their children can get a foot in property before any further rise in prices. End up HDB for Singaporeans n condos for rich people n foreigners. V hard to upgrade now.
Parents will find it difficult to buy properties for their children. So this rule will favour rich parents n their children can get a foot in property before any further rise in prices. End up HDB for Singaporeans n condos for rich people n foreigners. V hard to upgrade now.
Agreed. CM will have least impact on the rich. It's the non- rich who will feel the impact.
What the govt wants, what the govt gets.....
Every investment has a phase....
Don't be too highly strung on properties....
The goal is
1. Prevent a repeat of 1997 bubble burst
2. Prevent over leverage for multiple property owners
3. Give first timers a chance - prevent property speculation
Depending on which side u are on, there are advantages and disadvantages...
There are other investment instruments around... Hahahaha
LaFiestaOwner
29-06-13, 06:58
:doh: Then how, I buy to stay and now this come in. No wonder developer drop price. Are prices going to tank big time? Then I might as well sell off my property now and wait. If developer drop some more price and very significant, I will not sign my sales and purchase. Going to lose 25% of my deposit. :doh:
My personal feel is that it doesn't differ much from the current practice. Why? this is because MAS has been talking with banks since a few months ago, and MAS, as a regulator, wouldn't want to kill banks' business, MAS couldn't even afford the new loans to show year-on-year declines.
I'm not sure about the current practice as banks never question me when I took loans, however, my guess is that they didn't have a standardized framework to assess TDSR for all loans using 3.5%, what banks did were perhaps only looking at individual mortgage loans, applying a rate like 2.5% or 3%, they probably applied some haircuts to rental too, and banks are no-idiot, while they have been loose in the above, they probably applied a stricter and lower ratio for this individual mortgage service ratio, probably in the region of 40% to 50%. What MAS did was really to standardize it, and probably when MAS helped setup this new TDSR framework, they already took a survey of existing loan applicants, and found that some 95% of applicants satisfy the new TDSR framework, and only then they can launch the new framework.
You also say the bank never question you when you take loan...
MAS and the banks have VERY DIFFERENT objectives.
If you look at it from the point of the bank, if the LTV is 60%, do they care if you can finance the loan??? They don't care. If you cannot, they take back the property. If the property value fall by 20%, they ask for top up to safe guard themselves. To them it is pretty low risk. They don't care if the borrower defaults as long as they don't lose money.
MAS is different... they don't want too many borrowers to go and commit suicide as population will go down
What the govt wants, what the govt gets.....
Every investment has a phase....
Don't be too highly strung on properties....
The goal is
1. Prevent a repeat of 1997 bubble burst
2. Prevent over leverage for multiple property owners
3. Give first timers a chance - prevent property speculation
Depending on which side u are on, there are advantages and disadvantages...
There are other investment instruments around... Hahahaha
Other instruments are a lot more risky unless the average man in the street is very well-versed with the instruments and well supplied with information. But then they won't be the man in the street if they know. Unless you are talking about flipping Hello Kitty.
Haha...heng ar...I got 2 fully paid property and 1 under mortgage.
No impact on me. :tongue3:
Bro, how young are u? I still have 20% and 30% loan for the 1st two lei! I early 40s
LaFiestaOwner
29-06-13, 07:15
Other instruments are a lot more risky unless the average man in the street is very well-versed with the instruments and well supplied with information. But then they won't be the man in the street if they know. Unless you are talking about flipping Hello Kitty.
Sorry, First Timer like me is deciding whether to forfeit my 25% deposit. Scare the hell out of a 1st time buyer like me.:doh: Not for investment.
Bro, how young are u? I still have 20% and 30% loan for the 1st two lei! I early 40s
if you bought the properties early, your loans is always a low percentage because of the huge run up in prices.
That is why the LTV rulings did not protect the man on the street. It basically protected the banks.
A 60% LTV at todays prices is like 100% LTV at 2 years ago prices...
Sorry, First Timer like me is deciding whether to forfeit my 25% deposit. Scare the hell out of a 1st time buyer like me.:doh: Not for investment.
Relax bro. You have already made a choice. Whether you made a loss or profit still depends on your next move in next 4-15 years time. If you forfeit now, it's a confirmed loss. Go back to your basic reason for the commitment. Do not be intimidated by the media buzz. In fact, it's prob the best time to learn from it. The most significant signs to read were in the year 1998-99, 2003-04, 2009.
if you bought the properties early, your loans is always a low percentage because of the huge run up in prices.
That is why the LTV rulings did not protect the man on the street. It basically protected the banks.
A 60% LTV at todays prices is like 100% LTV at 2 years ago prices...
Applies esp to those older, FH, able to walk to MRT type, and nowadays also if nearby brand new development esp. FEO. :D
Relax bro. You have already made a choice. Whether you made a loss or profit still depends on your next move in next 4-15 years time. If you forfeit now, it's a confirmed loss. Go back to your basic reason for the commitment. Do not be intimidated by the media buzz. In fact, it's prob the best time to learn from it.
The most significant signs to read were in the year 1998-99, 2003-04, 2009.
Major events that shook the market
1998-99
2003-04
2009
My personal feel is that it doesn't differ much from the current practice. Why? this is because MAS has been talking with banks since a few months ago, and MAS, ............
We need forumers who just took loans in recent years and who have been able to understand how banks assess his TDSR and his eligibility, to contribute here, in order to gauge the impact. This is how a forum can really help.
With local bank D, the officer I spoke to (in 2009) assessed using 50% DSR based on total household fixed monthly income (including other loans and no inclusion of rental income). Although 35%-40% would be more my comfort zone, he claimed 50% is conservative enough.
With this CM, govt is stopping citizens from using "other people's money" to prosper/property thyself.
Other instruments are a lot more risky unless the average man in the street is very well-versed with the instruments and well supplied with information. But then they won't be the man in the street if they know. Unless you are talking about flipping Hello Kitty.
Sis, the man on the street is your average joe. Condo is 20% of the housing population. How to be man on the street??
But I agree with you, property is very simple... But it is not in the phase of fast growth. So minimal capital gains. Hahahaha
Now like this, can I ask, who is going to sell????
The market will now move sideways for a long time for resale.... Hahahaha
So most sales will come from new development....
Hint : This one has the same initials as our previous Prime Minister hor....heheheheheh
Don't say, don't say, please! :scared-1: :simmering:
You also say the bank never question you when you take loan...
Banks didn't question me, because my loan was really much more than qualified. That's why I asked for others who may have been questioned by banks before, and through the process may have an insight of banks' previous practices, as said, banks may have each have their own practices of assessing loan eligibility on top of LTV, and I'm trying to see if it differs much from MAS's new framework.
With local bank D, the officer I spoke to (in 2009) assessed using 50% DSR based on total household fixed monthly income (including other loans and no inclusion of rental income). Although 35%-40% would be more my comfort zone, he claimed 50% is conservative enough.
With this CM, govt is stopping citizens from using "other people's money" to prosper/property thyself.
Thanks for sharing.
So your bank D has already been applying total DSR instead of MSR before, any idea of what interest rate they used to calculate DSR?
Just to share, HK banks used to do stress testing of the ability of applicants to repay loans assuming mortgage rate increase of 2%, earlier this year, HK Monetary Authority require them to assume mortgage rate increase of 3%.
So it is likely that Singapore banks have already been using interest rates of around 3.5% to stress test the ability to repay loans. However, more confirmations are needed from those who had insights of their previous practices.
Thanks for sharing.
So your bank D has already been applying total DSR instead of MSR before, any idea of what interest rate they used to calculate DSR?
for the few loan application forms i filled, there were always fields to declare any other outstanding loans, including vehicle loans. But I am not sure whether the banks actually use those values for computation of loan approval.
You also say the bank never question you when you take loan...
MAS and the banks have VERY DIFFERENT objectives.
If you look at it from the point of the bank, if the LTV is 60%, do they care if you can finance the loan??? They don't care. If you cannot, they take back the property. If the property value fall by 20%, they ask for top up to safe guard themselves. To them it is pretty low risk. They don't care if the borrower defaults as long as they don't lose money.
MAS is different... they don't want too many borrowers to go and commit suicide as population will go down
MAS has cleverly built a backdoor for mortgage loan approvals even more than 60 percent so long as financial committee approves and there is a robust policy in place to monitor ... its not too hard to come up with one and written resolution approval ... I done a lot in my time as in-house for my company before also leh .... :cool:
Now like this, can I ask, who is going to sell????
The market will now move sideways for a long time for resale.... Hahahaha
So most sales will come from new development....
very sian .. i am aiming a resale one also as an upgrade :( emo to the max already
just checked. It is nearer to RGS which I will try tomm see if can walk along Shangri-La Hotel secret lane to Orchard bo. You see, I child that time very good at playing hide and seek in that place cause grandfather business is in that area lor.
eagerly awaiting your on-site report, and also tat of master DKSG one, feel on the ground especially after the MAS regulations is a good gauge of market sentiment
Secretariat
29-06-13, 12:04
Just to share, HK banks used to do stress testing of the ability of applicants to repay loans assuming mortgage rate increase of 2%, earlier this year, HK Monetary Authority require them to assume mortgage rate increase of 3%.
So it is likely that Singapore banks have already been using interest rates of around 3.5% to stress test the ability to repay loans. However, more confirmations are needed from those who had insights of their previous practices.
I could confirm that, in 4qtr 2009, the newly announced MAS framework, in relation to TDSR, 70% of variable income, has/had been practiced by the local banks.
I requested the details, because at the time the markets were still volatile, and wanted to measure all the risks before investing in the landed, in term of what the bank would/could do when property prices continued to fall once vested.
In fact, I still have the handwritten worksheets, from the loan officers of DBS, UOB etc, as they explained the details.
The prevailing interest rates for the loan tenure required were used, not the forwarding rate as imposed by MAS today.
Maybe MAS announced the framework because the banks have been too liberal recently.
Cheers!
Thanks for sharing.
So your bank D has already been applying total DSR instead of MSR before, any idea of what interest rate they used to calculate DSR?
Should be 2.5% thereabout, cannot really remember.
How many return units for J-gateway so far?
How many return units for J-gateway so far?
YOWETAN. are you a reporter? Online troller?
Do the new rules affect repricing of loans?
YOWETAN. are you a reporter? Online troller?
Hi...I am a gentleman whose vision is to own a Mt Sinai property.
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