View Full Version : [Advise-Needed] HDB + Private
Situation.
guy & wife own a fully paid up HDB flat.
his parents, 80s, own a private property, fully paid up.
parents want to "transfer" / "gift" it to him.
parents used cpf to pay for the private property so there is a cpf "charge" on the property
he say paying bsd + absd is not a problem
(a) what is the most efficient manner to "transfer" / "gift" it to him considering the least amount of cash required to make this happen.
(b) after everything settled, private property in his name, can he take loan against the private property so that he can take money from the loan and give parents.
any advise?
guy & wife own a fully paid up HDB flat.
-----Age of Guy & wife. Any Child, outstanding loan, etc.
his parents, 80s, own a private property, fully paid up.
------- property LH or FH, what type
parents want to "transfer" / "gift" it to him.
parents used cpf to pay for the private property so there is a cpf "charge" on the property
-------What is the charge amount.
he say paying bsd + absd is not a problem
--------Don't think of paying, think how not to pay first.
(a) what is the most efficient manner to "transfer" / "gift" it to him considering the least amount of cash required to make this happen.
----------Not pratical.
(b) after everything settled, private property in his name, can he take loan against the private property so that he can take money from the loan and give parents.
-----------Not a good idea.
thank you for your reply.
======
guy & wife own a fully paid up HDB flat.
-----Age of Guy & wife. Any Child, outstanding loan, etc.
====== late 40s
his parents, 80s, own a private property, fully paid up.
------- property LH or FH, what type
====== FH
parents want to "transfer" / "gift" it to him.
parents used cpf to pay for the private property so there is a cpf "charge" on the property
-------What is the charge amount.
====== total slightly more than 1M
he say paying bsd + absd is not a problem
--------Don't think of paying, think how not to pay first.
(a) what is the most efficient manner to "transfer" / "gift" it to him considering the least amount of cash required to make this happen.
----------Not pratical.
(b) after everything settled, private property in his name, can he take loan against the private property so that he can take money from the loan and give parents.
-----------Not a good idea.
thank you for your reply.
======
guy & wife own a fully paid up HDB flat.
-----Age of Guy & wife. Any Child, outstanding loan, etc.
====== late 40s ,Any Child, outstanding loan, etc.
his parents, 80s, own a private property, fully paid up.
------- property LH or FH, what type
====== FH, condition of the property need any major repair
parents want to "transfer" / "gift" it to him.
parents used cpf to pay for the private property so there is a cpf "charge" on the property
-------What is the charge amount.
====== total slightly more than 1M How much you can get after paying 1 million
he say paying bsd + absd is not a problem
--------Don't think of paying, think how not to pay first.
(a) what is the most efficient manner to "transfer" / "gift" it to him considering the least amount of cash required to make this happen.
----------Not pratical.
(b) after everything settled, private property in his name, can he take loan against the private property so that he can take money from the loan and give parents.
-----------Not a good idea.
You are going to pay a million, how much do you think you can get from the bank after paying.
====== late 40s, 2 kids (teens), zero outstanding loan
====== FH, livable, probably need change aircon and some white goods
====== between the parents, charge amount with CPF is slight more than 1M
====== property valuation is 2M
pardon my ignorance, but don't really understand the question = "You are going to pay a million, how much do you think you can get from the bank after paying."
====== late 40s, 2 kids (teens), zero outstanding loan
====== FH, livable, probably need change aircon and some white goods
====== between the parents, charge amount with CPF is slight more than 1M
====== property valuation is 2M
pardon my ignorance, but don't really understand the question = "You are going to pay a million, how much do you think you can get from the bank after paying."
You need to pay back CPF, or your parent got the cash to pay.
You need to pay back CPF, or your parent got the cash to pay.
it seems like the following
- valuation 2M
- get loan from bank (1.2M)
- pay BSD 3% = 60K
- pay ABSD 7% = 140K (2nd property)
- pay parents CPF (1M), then 1 week later, after making sure parents CPF enough in RA account, then money will be returned to them in cash
- name change done, parents got 1M in cash
- take back say 500K from parents and return to bank
- owe bank $700K
- name change done, parents got $500K in bank, and son got $700K loan
that's the best?
it seems like the following
- valuation 2M
- get loan from bank (1.2M)
- pay BSD 3% = 60K
- pay ABSD 7% = 140K (2nd property)
- pay parents CPF (1M), then 1 week later, after making sure parents CPF enough in RA account, then money will be returned to them in cash
- name change done, parents got 1M in cash
- take back say 500K from parents and return to bank
- owe bank $700K
- name change done, parents got $500K in bank, and son got $700K loan
that's the best?
- get loan from bank (1.2M)
This one don't understand
Can only get 50%
Where parent stay after transfer?
need to loan money to pay BSD + ABSD + parents CPF (1M)
no money leh!
need to loan money to pay BSD + ABSD + parents CPF (1M)
no money leh!
ic, but can only get 50% of the valuation.
Don’t get too excited yet like the stock market, it’s only applicable to those who take an equity term loan of not more than 50% of the current property valuation.
http://www.mortgagewise.sg/tdsr-removed/
parents got another FH property to stay. they are current staying in this one.
property rich - cash poor ... lol!
Your parent needs any God Son, 53 years old.
property rich - cash poor ... lol!
Go for term loan then after transfer goes for cash out then return money to parent.
Your parent needs any God Son, 53 years old.
LOL - Submit your application :D
Go for term loan then after transfer goes for cash out then return money to parent.
Term loan ... ok.
Loan from bank, that's what I am thinking to do.
Loan from bank like doing a real purchase, maybe $1.2M
pay BSD + ABSD, pay parents CPF, when parents CPF gets return to them, then ask them how much they want to keep
if they want to keep $500K, then i return $500K to bank
then I owe bank $700K
why need to transfer/gift now?
why not wait for parents to pass away and the guy can inherit?
dont have long to wait since both are 80s. (how many 10-year will they have?)
question: if inherit, still need to pay CPF charge or not when selling the inherited property?
http://www.straitstimes.com/business/property/askst-does-inheritance-property-attract-additional-buyers-stamp-duty
from article, looks like by inheritance, no need to pay ABSD. so if inherit the 2 FH, also no ABSD?
LOL - Submit your application :D
Term loan ... ok.
Loan from bank, that's what I am thinking to do.
Loan from bank like doing a real purchase, maybe $1.2M
pay BSD + ABSD, pay parents CPF, when parents CPF gets return to them, then ask them how much they want to keep
if they want to keep $500K, then i return $500K to bank
then I owe bank $700K
No,
Loan for BSD and ABSD. Term Loan(bridging loan got to check with bank)
CPF need to check with CPF whether Transfer still needs to pay back.
Then Cash out.
http://www.newlaunchesreview.com/wp-content/uploads/2013/04/LTV.jpg
To buy need 25% cash and loan max 50%
You can get a million dollar loan but still, need 25% cash.
why need to transfer/gift now?
why not wait for parents to pass away and the guy can inherit?
dont have long to wait since both are 80s. (how many 10-year will they have?)
question: if inherit, still need to pay CPF charge or not when selling the inherited property?
http://www.straitstimes.com/business/property/askst-does-inheritance-property-attract-additional-buyers-stamp-duty
from article, looks like by inheritance, no need to pay ABSD. so if inherit the 2 FH, also no ABSD?
Cash poor. Need money now. Not many 10 years to go.
Many forget when they are no more working their cash in hand can only reduce as time past.
why need to transfer/gift now?
why not wait for parents to pass away and the guy can inherit?
dont have long to wait since both are 80s. (how many 10-year will they have?)
question: if inherit, still need to pay CPF charge or not when selling the inherited property?
http://www.straitstimes.com/business/property/askst-does-inheritance-property-attract-additional-buyers-stamp-duty
from article, looks like by inheritance, no need to pay ABSD. so if inherit the 2 FH, also no ABSD?
because parents want some money
they have a place to stay
they have enough for daily expenses
but
no money to buy gifts and presents to relatives
no money to go play jackpot!
No,
Loan for BSD and ABSD. Term Loan(bridging loan got to check with bank)
CPF need to check with CPF whether Transfer still needs to pay back.
Then Cash out.
http://www.newlaunchesreview.com/wp-content/uploads/2013/04/LTV.jpg
To buy need 25% cash and loan max 50%
guy and wife no more loan
hdb all paid
so technically if loan for the private property, will be 1st loan
but they very little cash/cpf
bridging loan possible i think
Cash poor. Need money now. Not many 10 years to go.
Many forget when they are no more working their cash in hand can only reduce as time past.
yes, correct. i think the old parents mis-calculated. 2 FH properties. both paid up. roof covered, daily expenses covered but still want some money in hand.
i think under the previous rules, cpf for transfer no need to return back. but i think nowadays, even transfer, cpf must pay back first, then after 1 week, the sum can be cashed out by the old parents. the rational was that 2 parties share of usage of CPF in the property is different, hence, must return all the CPF first then cash out accordingly. but of course, to cash out, CPF will then keep the full retirement sum before the release the rest. CPF very smart lor.
bridging loan 15% only
https://www.hsbc.com.sg/1/2/personal/loans/bridging-loan
not enough to work for the "refund" of the 1M back to the CPF
so now, at present, the follow current plan is probably still the only one workable.
- FH valued $2M
- son + wife HDB fully paid, no loan
- son + wife go and take loan from bank to purchase the FH, 80% loan $1.6M (this will be son + wife 1st loan since HDB loan already fully paid)
- son + wife cash pay BSD $60K
- son + wife cash pay ABSD $140K (because FH is the son + wife 2nd property, hence 7% extra ABSD)
- son + wife cash pay lawyer fee etc $5K
- son + wife cash pay 20% deposit $400K
once sale is done, FH property in name of son + wife
- old parents will get $1M refunded into CPF
- presume that they current only have 50% of RA minimum sum because of property pledge, CPF need to retain $100K each
- so old parents will only get $800K cash out from CPF
- old parents will also get $1M cash from sale of property
- old parents will get $1.8M cash total
- old parents keep $500K cash for themselves
- old parents return $1.3M cash to son+wife
- son + wife return $1.3M to bank
- son + wife still own bank $300K
but in order to make this happen
- son + wife must get $1.6M loan from bank
- son + wife must have cash for BSD $60K + ABSD $140K + Lawyer and Misc Fee $5K + 20% Deposit $400K = $605K
any one has a better option?
so now, at present, the follow current plan is probably still the only one workable.
- FH valued $2M
- son + wife HDB fully paid, no loan
- son + wife go and take loan from bank to purchase the FH, 80% loan $1.6M (this will be son + wife 1st loan since HDB loan already fully paid)
- son + wife cash pay BSD $60K
- son + wife cash pay ABSD $140K (because FH is the son + wife 2nd property, hence 7% extra ABSD)
- son + wife cash pay lawyer fee etc $5K
- son + wife cash pay 20% deposit $400K
once sale is done, FH property in name of son + wife
- old parents will get $1M refunded into CPF
- presume that they current only have 50% of RA minimum sum because of property pledge, CPF need to retain $100K each
- so old parents will only get $800K cash out from CPF
- old parents will also get $1M cash from sale of property
- old parents will get $1.8M cash total
- old parents keep $500K cash for themselves
- old parents return $1.3M cash to son+wife
- son + wife return $1.3M to bank
- son + wife still own bank $300K
but in order to make this happen
- son + wife must get $1.6M loan from bank
- son + wife must have cash for BSD $60K + ABSD $140K + Lawyer and Misc Fee $5K + 20% Deposit $400K = $605K
any one has a better option?
you forget TDSR for Loan.
check with CPF, i don't think need to reply CPF.
why so complicated, ask your parent takes an equity loan on the property of less than 50%
No need to pay BSD, ABSD, no TDSR
why so complicated, ask your parent takes an equity loan on the property of less than 50%
No need to pay BSD, ABSD, no TDSR
Parent want son to learn to walk, don't want to bottle feed.
Every family got their own story(problem), I see this as a good problem for him to solve.
why so complicated, ask your parent takes an equity loan on the property of less than 50%
No need to pay BSD, ABSD, no TDSR
with ref = https://www.icompareloan.com/resources/hong-leong-finance-launches-term-loan-asset-rich/
because old parents are not working, hence only Hong Leong Finance can do
equity loan ... is based on 50% of valuation
2M Valuation ... 50% = 1M
but because there is a 1M charge on the property by CPF,
therefore total eligible equity loan = $0
the equity loan is actually based on 50% of the valuation, then less the CPF charge if any and if there is remaining, that's the loan that one can take.
in this case, equity loan not available.
Yes, you are right.
Government regards your CPF as though it is "NOT your money" hence the CPF you took to pay loan MUST be considered a "LOAN" by the BANKS and not "EQUITY" to you when calculating TDSR/loan eligible from banks.....
So max amount banks can loan you = LTV*property price - CPF owed
with ref = https://www.icompareloan.com/resources/hong-leong-finance-launches-term-loan-asset-rich/
because old parents are not working, hence only Hong Leong Finance can do
equity loan ... is based on 50% of valuation
2M Valuation ... 50% = 1M
but because there is a 1M charge on the property by CPF,
therefore total eligible equity loan = $0
the equity loan is actually based on 50% of the valuation, then less the CPF charge if any and if there is remaining, that's the loan that one can take.
in this case, equity loan not available.
https://vimeo.com/183016901
with ref = https://www.icompareloan.com/resources/hong-leong-finance-launches-term-loan-asset-rich/
because old parents are not working, hence only Hong Leong Finance can do
equity loan ... is based on 50% of valuation
2M Valuation ... 50% = 1M
but because there is a 1M charge on the property by CPF,
therefore total eligible equity loan = $0
the equity loan is actually based on 50% of the valuation, then less the CPF charge if any and if there is remaining, that's the loan that one can take.
in this case, equity loan not available.
After 65, CPF money is your money minus retirement sum set aside. As your PIL is in the 80s, there is no retirement sum for those in that age group and they could withdraw even earlier.
Master Shifu is wise. Thanks for solving the puzzle.
After 65, CPF money is your money minus retirement sum set aside. As your PIL is in the 80s, there is no retirement sum for those in that age group and they could withdraw even earlier.
After 65, CPF money is your money minus retirement sum set aside. As your PIL is in the 80s, there is no retirement sum for those in that age group and they could withdraw even earlier.
Typo error. Should be 55 instead of 65
https://www.cpf.gov.sg/Members/Schemes/schemes/retirement/withdrawals-of-cpf-savings-from-55
just find the payment of BSD and ABSD very painful.
how many years to take to save $200,00
After 65, CPF money is your money minus retirement sum set aside. As your PIL is in the 80s, there is no retirement sum for those in that age group and they could withdraw even earlier.
Typo error. Should be 55 instead of 65
https://www.cpf.gov.sg/Members/Schemes/schemes/retirement/withdrawals-of-cpf-savings-from-55
i agree with you. you are correct but i just cannot get around the CPF rules.
CPF rules that because the old parents used the property to offset the 50% requirement of the RA, the total CPF sum used must be returned to CPF first and then deducted for the requirement to top-up RA account to full sum, before dispersing back to the old parents 1 week later.
so in essence, for their case, there must be a 1M returned to the CPF, let CPF deduct say 100K each so that each of the their RA can be topped-up in full sum, then the remaining 800K will be dispersed to them 1 week later.
to make things happen, the 1M must appear first. that's painful.
just find the payment of BSD and ABSD very painful.
how many years to take to save $200,00
exactly my point as well. saying it as plainly ... why cannot wait till old parents kick the bucket, after all, they are 80 plus already. law of averages say less than 20 years? but to the old parents, there is now a possibility of spending some $$$ in order for them to get $500K now. so for them, that's the result they are eyeing, so the son has to work it out.
anythingwhatever
11-06-17, 08:43
Based on current regulations, the Thread Starter should just sell off the HDB, get the Gifted Property under his name only. If got spare cash then can buy another private under wife's name only.
No painful ABSD. :)
http://eresources.nlb.gov.sg/infopedia/articles/SIP_573_2005-01-05.html
1 Jan 1987 : Minimum Sum scheme introduced at S$30,000.
i agree with you. you are correct but i just cannot get around the CPF rules.
CPF rules that because the old parents used the property to offset the 50% requirement of the RA, the total CPF sum used must be returned to CPF first and then deducted for the requirement to top-up RA account to full sum, before dispersing back to the old parents 1 week later.
so in essence, for their case, there must be a 1M returned to the CPF, let CPF deduct say 100K each so that each of the their RA can be topped-up in full sum, then the remaining 800K will be dispersed to them 1 week later.
to make things happen, the 1M must appear first. that's painful.
exactly my point as well. saying it as plainly ... why cannot wait till old parents kick the bucket, after all, they are 80 plus already. law of averages say less than 20 years? but to the old parents, there is now a possibility of spending some $$$ in order for them to get $500K now. so for them, that's the result they are eyeing, so the son has to work it out.
In their 80s, their cpf scheme is totally diff from us. Do check.
Curious, why don't your PIL sell the condo?
i agree with you. you are correct but i just cannot get around the CPF rules.
CPF rules that because the old parents used the property to offset the 50% requirement of the RA, the total CPF sum used must be returned to CPF first and then deducted for the requirement to top-up RA account to full sum, before dispersing back to the old parents 1 week later.
so in essence, for their case, there must be a 1M returned to the CPF, let CPF deduct say 100K each so that each of the their RA can be topped-up in full sum, then the remaining 800K will be dispersed to them 1 week later.
to make things happen, the 1M must appear first. that's painful.
exactly my point as well. saying it as plainly ... why cannot wait till old parents kick the bucket, after all, they are 80 plus already. law of averages say less than 20 years? but to the old parents, there is now a possibility of spending some $$$ in order for them to get $500K now. so for them, that's the result they are eyeing, so the son has to work it out.
I am not too sure, there is this reverse mortgage where a fixed sum can be drawn monthly...and may need to sell at the end to repay the outstanding.
U can check with mortgage specialists in the market, may have solution
Curious, why don't your PIL sell the condo?
FH Landed
http://eresources.nlb.gov.sg/infopedia/articles/SIP_573_2005-01-05.html
1 Jan 1987 : Minimum Sum scheme introduced at S$30,000.
Already inform him, guess he must have check with CPF or he is AssUming all the way.
I am not too sure, there is this reverse mortgage where a fixed sum can be drawn monthly...and may need to sell at the end to repay the outstanding.
U can check with mortgage specialists in the market, may have solution
Parents want him to learn, don't want to bottle feed. Very good parents who want the best for the child. The child will become stronger after this excecise. Coming to this forum to seek help is the first step.
Cannot agree more. Learning from the forum, self exploration, search and read. That's probably a lot better than just walking to a bank and listen blindly to the loan banker. But at the end of the day, the wealth of experience and wealth of knowledge in this forum, that's what makes it special.
just find the payment of BSD and ABSD very painful.
how many years to take to save $200,00
Can still try HDB ownership transfer? :p
http://www.hdb.gov.sg/cs/infoweb/residential/living-in-an-hdb-flat/changing-owners-occupiers/change-in-ownership
anythingwhatever
12-06-17, 20:25
Can still try HDB ownership transfer? :p
http://www.hdb.gov.sg/cs/infoweb/residential/living-in-an-hdb-flat/changing-owners-occupiers/change-in-ownership
Can't be done between Married Couple.
Can still try HDB ownership transfer? :p
http://www.hdb.gov.sg/cs/infoweb/residential/living-in-an-hdb-flat/changing-owners-occupiers/change-in-ownership
https://www.99.co/blog/singapore/hdb-decoupling/
HDB decoupling has been a cost saving tactic since around 2013. Once the Additional Buyers’ Stamp Duty (ABSD) was announced, several investors quickly caught on to what was essentially a legal loophole. By transferring full ownership of their flat to a spouse, they could attain their second property at a much lower cost. This has since been changed, but it leaves us wondering why it took so long in the first place:
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