View Full Version : Circumventing the New Rules
The new rules prohibit HDB owners from owning another private ppty within the MOP.
Suppose he registers a new company, puts whatever cash he has into that company; takes a bank loan out on the remainder and purchase a private ppty in the company's name. Then rents out the private ppty.
As director of the company, he can pay himself any amount he likes and makes it appear the company is not making any profit. Minimum taxes paid.
Any other work-arounds you guys can think of?
stalingrad
06-09-10, 15:29
The new rules prohibit HDB owners from owning another private ppty within the MOP.
Suppose he registers a new company, puts whatever cash he has into that company; takes a bank loan out on the remainder and purchase a private ppty in the company's name. Then rents out the private ppty.
As director of the company, he can pay himself any amount he likes and makes it appear the company is not making any profit. Minimum taxes paid.
Any other work-arounds you guys can think of?
seems more troublesome than just wait out the MOP. besides, you are likely to get caught, and spend the rest of your life in jail.
I don't think you should be discussing this openly here. You will be surprised who is reading in these forums.
Think anyone can start a company for Property Investment right? Perhaps the next Fragrance Group on the making! :D
Dun think it's illegal, setup a company u will have to pay tax (not just property tax), CPF etc... end of the day you have the weight pro and con.
Of course. The whole point of a forum is open and transparent communication and exchange of ideas for common benefit.
So talking about this is to explore legal alternatives.
The govt recent measure cuts both speculators and genuine investors equally.
Understand the part about additional costs like admin and taxes but that is to be expected but can be overcome by good tax advise and management.
5 years is just too long an invstment cycle to be ignored. So ways must be explored.
So the qn remains unanswered. Is it legal?
I think the only way for those within MOP is to purchase condo under the name of a corporation. But too much an harsh + taxes...
haha.. someone mentioned fake divorce earlier, cannot remember who. Judicial separation also can.
Geylang OKT
06-09-10, 22:37
haha.. someone mentioned fake divorce earlier, cannot remember who. Judicial separation also can.
Means you can never marry again? Above is almost the same as divorce in terms of splitting of assets... but no divorce papers signed (could be in deference to certain faiths which abhor divorces) :D :D :D
haha.. someone mentioned fake divorce earlier, cannot remember who. Judicial separation also can.
well, this is one way...:D :D
can divorce, but still stay together, meanwhile can use children name to buy another one...:D
well, this is one way...:D :D
can divorce, but still stay together, meanwhile can use children name to buy another one...:D
no restriction on minimum age right?
:D
no restriction on minimum age right?
have to confirm the age with HDB ....why you want to try ?:D
later spouse take the opportunity to bao lu...luggie big...
Geylang OKT
06-09-10, 23:01
well, this is one way...:D :D
can divorce, but still stay together, meanwhile can use children name to buy another one...:D
No restriction on children ages of course :scared-4:
The party maintaining the children should be the one applying... so if you are the ex-husband you keep the hdb flat and ask your "ex"-wife to apply (i.e. child to follow wife). If the ex-husband has both custody and maintaining the child, the ex-wife can forget about applying :D
The party maintaining the children should be the one applying... so if you are the ex-husband you keep the hdb flat and ask your "ex"-wife to apply (i.e. child to follow wife). If the ex-husband has both custody and maintaining the child, the ex-wife can forget about applying :D
OKT bro, you teach people bad bad...:D :D
lucky singapore only allow one wife ha ha
Geylang OKT
06-09-10, 23:04
OKT bro, you teach people bad bad...:D :D
lucky singapore only allow one wife ha ha
Hahahahaha Bro :D :D :D
The new rules prohibit HDB owners from owning another private ppty within the MOP.
Suppose he registers a new company, puts whatever cash he has into that company; takes a bank loan out on the remainder and purchase a private ppty in the company's name. Then rents out the private ppty.
As director of the company, he can pay himself any amount he likes and makes it appear the company is not making any profit. Minimum taxes paid.
Any other work-arounds you guys can think of?
Not a good idea.
1) Banks normally charge higher interest for borrowing under corporate entity than individual.
2) Banks' credit assessment is stricter for corporates. u need to provide financial statements annually for review. It is both expensive and troublesome.
3) Once you sold the property, the profit is taxable, whereas for individuals, capital gains are not taxable.
Similarly a friend of mine intend to do this. Her hdb has MOP of 5 years but she still have 3.5 years to go. She intend to use her mum's name to buy private if the price go down cos she has got high cash savings on hand. Her mum is a divorcee and not working. Currently own hdb fully paid. If use her mum's name to buy, bank will loan meh? If banks willing to loan, will her mum lose all hdb/ senior citizen benefits etc? If use my friend as guarantor possible to take bank loan for property bought under her mum's name..?What will be the repercussion cos I never heard of people doing that??:beats-me-man:
Similarly a friend of mine intend to do this. Her hdb has MOP of 5 years but she still have 3.5 years to go. She intend to use her mum's name to buy private if the price go down cos she has got high cash savings on hand. Her mum is a divorcee and not working.
can buy, HDB dont care where the money came from, just under who's name. If not working, might have problem with loan. But the solution is to pay in full. Just be sure not to be caught renting out during the MOP.
Currently own hdb fully paid. If use her mum's name to buy, bank will loan meh? If banks willing to loan, will her mum lose all hdb/ senior citizen benefits etc? If use my friend as guarantor possible to take bank loan for property bought under her mum's name..?What will be the repercussion cos I never heard of people doing that??:beats-me-man:
repercussion is bankrupt. Never heard of people doing that means it is a stoppid move.
can buy, HDB dont care where the money came from, just under who's name. If not working, might have problem with loan. But the solution is to pay in full. Just be sure not to be caught renting out during the MOP.
repercussion is bankrupt. Never heard of people doing that means it is a stoppid move.
She said she has enough cash for 70% loan so I assume she dun have enough to pay in full. But even her mum not working, the daughter can be guarantor right? Just that daughter's hdb under MOP ruling so will it affect loan?? Erm... "never heard of people doing this" can also mean I "suaku"(mountain tortoise):D
Of course. The whole point of a forum is open and transparent communication and exchange of ideas for common benefit.
So talking about this is to explore legal alternatives.
The govt recent measure cuts both speculators and genuine investors equally.
Understand the part about additional costs like admin and taxes but that is to be expected but can be overcome by good tax advise and management.
5 years is just too long an invstment cycle to be ignored. So ways must be explored.
So the qn remains unanswered. Is it legal?
when u set up a company, u must state yr biz nature. if set up as investment co, of course is legal to buy property. but taxable on gain. i think is quite a hassle unless u are really going to do it as business
She said she has enough cash for 70% loan so I assume she dun have enough to pay in full. But even her mum not working, the daughter can be guarantor right? Just that daughter's hdb under MOP ruling so will it affect loan?? Erm... "never heard of people doing this" can also mean I "suaku"(mountain tortoise):D
yup, a stopid suaku..
her mother not working? how to loan from bank?
Guarantor to HDB? To Bank? Mother is Mother, Daughter is Daughter.
Suaku is Suaku
Her mother got own HDB but want to invest in private for her daughter with money by daughter. I suggest that her daughter pay up her HDB in full then she can buy without the restrictive rules. No need to turn left turn right until turn turtle.
yup, a stopid suaku..
her mother not working? how to loan from bank?
Guarantor to HDB? To Bank? Mother is Mother, Daughter is Daughter.
Suaku is Suaku
Her mother got own HDB but want to invest in private for her daughter with money by daughter. I suggest that her daughter pay up her HDB in full then she can buy without the restrictive rules. No need to turn left turn right until turn turtle.
I mean guarantor to bank that she has the ability to pay bank loan for the condo. Ok, so I shall tell her that it will not work cos I think she pinning high hopes of using her mum's name buy condo when price correct.
Btw you sugeest paying up hdb in full, you mean if hdb paid in full before MOP then MOP ruling do not exist??
:D :D
I mean guarantor to bank that she has the ability to pay bank loan for the condo. Ok, so I shall tell her that it will not work cos I think she pinning high hopes of using her mum's name buy condo when price correct.
Btw you sugeest paying up hdb in full, you mean if hdb paid in full before MOP then MOP ruling do not exist??
:) MOP is MOP.. 5 years is 5 years. 80% or 70% depends on whether got outstanding loan or not.
At least you take my goods postively.
Good :D :D
She said she has enough cash for 70% loan so I assume she dun have enough to pay in full. But even her mum not working, the daughter can be guarantor right? Just that daughter's hdb under MOP ruling so will it affect loan?? Erm... "never heard of people doing this" can also mean I "suaku"(mountain tortoise):D
Not true that non working mum cannot get a bank loan. If she is able to come up with a bigger downpayment, eg 50%, the bank will lend. This is known as asset based loan, instead of income based loan. At 50% loan, even if the property market crashes by 40% the bank's equity remains safe. That's why banks are still keen to lend money to retirees to buy properties if the buyers put down a large downpayment.
when u set up a company, u must state yr biz nature. if set up as investment co, of course is legal to buy property. but taxable on gain. i think is quite a hassle unless u are really going to do it as business
Thx for the replies.
Now waiting for more legal loopholes.
The MIL loophole is fraught with loan issues.
The divorce loophole is socially unacceptable.
How about using your 18 year old son's name and buy that private property within the MOP? Any legal issues here besides him running away with a girl? Maybe make him sign an IOU and a letter for Power of Attorney.
Thx for the replies.
Now waiting for more legal loopholes.
The MIL loophole is fraught with loan issues.
The divorce loophole is socially unacceptable.
How about using your 18 year old son's name and buy that private property within the MOP? Any legal issues here besides him running away with a girl? Maybe make him sign an IOU and a letter for Power of Attorney.
he cannot buy a new hdb or ec until the property got sold. Even then, it has to be after 3 years after selling.
Might as well ask him to buy private/hdb right from the start.
Not true that non working mum cannot get a bank loan. If she is able to come up with a bigger downpayment, eg 50%, the bank will lend. This is known as asset based loan, instead of income based loan. At 50% loan, even if the property market crashes by 40% the bank's equity remains safe. That's why banks are still keen to lend money to retirees to buy properties if the buyers put down a large downpayment.
Make sure u get the loan sorted out first.
All these for what? It is not as if property always make money.
Post 1997 is a fine example.
What happen when non working mum die? Your money under your non working mum gets [will] away to her secret lover how?
Don't be too naive and do funny tricks. End up being the biggest fool. I would be most happy as a non working mum to have my son or daughter or son/daughter in law buy property and put under my name. Do people really actually do such [SILLY AND STUPID] things?
Make sure u get the loan sorted out first.
All these for what? It is not as if property always make money.
Post 1997 is a fine example.
What happen when non working mum die? Your money under your non working mum gets [will] away to her secret lover how?
Don't be too naive and do funny tricks. End up being the biggest fool. I would be most happy as a non working mum to have my son or daughter or son/daughter in law buy property and put under my name. Do people really actually do such [SILLY AND STUPID] things?
I don't know what your issues are. If you think your mum cannot be trusted then it's your beef. Not anyone else's. It's not me who suggested that it's a good idea to buy a house and put it into someone else's name. I'm just rebutting your point that a non-working person cannot get a housing loan because he/she has no salary. It's ok to state an opinion but don't present it as a fact when you don't know what you are talking about.
devilplate
08-09-10, 00:22
Not true that non working mum cannot get a bank loan. If she is able to come up with a bigger downpayment, eg 50%, the bank will lend. This is known as asset based loan, instead of income based loan. At 50% loan, even if the property market crashes by 40% the bank's equity remains safe. That's why banks are still keen to lend money to retirees to buy properties if the buyers put down a large downpayment.
tats very right.....most banks 40% downpayment will do the trick oredi....dun even nid to show income slips blah blah....whr got time...haha
certain banks 30% downpayment+mabe 100k deposit also sufficient....
banks prefer asset based loans actually.....income can anytime become zero once retrenched....
tats very right.....most banks 40% downpayment will do the trick oredi....dun even nid to show income slips blah blah....whr got time...haha
certain banks 30% downpayment+mabe 100k deposit also sufficient....
banks prefer asset based loans actually.....income can anytime become zero once retrenched....
Of course they will be happy if owner default in the case. Can gain at least 40% or more in bullish market. But they probably will sell it at a discount of 10% to 20%. Win Win for bank and buyer. Seller loses all.
Bank auctions are for?
And Bankrupts are by choice issit?
Bankers are waiting for you to default, they then come in to clean up with your money (take your money). Devil knows best right?
I don't know what your issues are. If you think your mum cannot be trusted then it's your beef. Not anyone else's. It's not me who suggested that it's a good idea to buy a house and put it into someone else's name. I'm just rebutting your point that a non-working person cannot get a housing loan because he/she has no salary. It's ok to state an opinion but don't present it as a fact when you don't know what you are talking about.
hahah, ok you win. Get a loan quickly. Buy that house Now! You are right, those agents without salary can get loans most of the time. That is a fact right?
Who says I duno what I am talking about. I said, non working mother, its a fact no income from work. Other side incomes from husband, god fathers and children etc are not mentioned. Which bank would loan without collateral in that case or huge cash deposit.
It is really a fact, no income no loan.
If u want to cock and bull and twist that 40 % down in cash etc. That is a different story all together.
Do banks give loan to retirees without income (dun say he has $40% or 100k etc whatever shit?) Dont cock and say he is loaded with CPF and banks will do just that.
yup, a stopid suaku..
her mother not working? how to loan from bank?
Guarantor to HDB? To Bank? Mother is Mother, Daughter is Daughter.
Suaku is Suaku
Her mother got own HDB but want to invest in private for her daughter with money by daughter. I suggest that her daughter pay up her HDB in full then she can buy without the restrictive rules. No need to turn left turn right until turn turtle.
This is what you said: Not working = how to get loan? Which is rubbish! From your remarks, I can tell you are uncouth and unable to argue coherently but instead jump from one issue to another and throwing in childish insults to deflect the shortcomings of your arguments. Relax. There is nothing to win here. This is not a school debate. In this forum we share measured opinions based on FACTS and hopefully everyone is better informed as a result.
This is what you said: Not working = how to get loan? Which is rubbish! From your remarks, I can tell you are uncouth and unable to argue coherently but instead jump from one issue to another and throwing in childish insults to deflect the shortcomings of your arguments. Relax. There is nothing to win here. This is not a school debate. In this forum we share measured opinions based on FACTS and hopefully everyone is better informed as a result.
my "her mother not working = how to get loan" irks you, so the opposite must be able to please you right?
it now becomes "her mother not working = sure to get loan".
If cannot get loan, find the joker who said can.
Now I wonder what is the legal age you're allowed to own a private property?
devilplate
09-09-10, 18:19
Now I wonder what is the legal age you're allowed to own a private property?
hmmmm 18yo?
hmmmm 18yo?
Nope, for HDB and Condo, Landed, All 21.
Can hold under trust though.
devilplate
09-09-10, 23:05
Nope, for HDB and Condo, Landed, All 21.
Can hold under trust though.
21yo=adult in SG....ang mor countries all 18yo rite....
21yo=adult in SG....ang mor countries all 18yo rite....
SG mah... :)
Asking the hdb-cum-private experts here...
According to hdb rules, private owners must 'dispose of private property' within 6 months of getting a hdb. My question is: what constitutes 'disposed'? Would transfer ownership to my parent, for example, count as 'disposed'?
Has anyone done this?
kingkong1984
16-02-11, 23:54
Asking the hdb-cum-private experts here...
According to hdb rules, private owners must 'dispose of private property' within 6 months of getting a hdb. My question is: what constitutes 'disposed'? Would transfer ownership to my parent, for example, count as 'disposed'?
Has anyone done this?
disposed means not under your name lah...
not done it so cannot share further.
rattydrama
17-02-11, 04:07
Asking the hdb-cum-private experts here...
According to hdb rules, private owners must 'dispose of private property' within 6 months of getting a hdb. My question is: what constitutes 'disposed'? Would transfer ownership to my parent, for example, count as 'disposed'?
Has anyone done this?
dispose means to sell. You can sell to anyone who is eligible. Can be your parents @ market rate.
Geylang OKT
17-02-11, 05:40
Can dispose mean throwaway? :D
The new rules prohibit HDB owners from owning another private ppty within the MOP.
Suppose he registers a new company, puts whatever cash he has into that company; takes a bank loan out on the remainder and purchase a private ppty in the company's name. Then rents out the private ppty.
As director of the company, he can pay himself any amount he likes and makes it appear the company is not making any profit. Minimum taxes paid.
Any other work-arounds you guys can think of?
looks perfectly legal to me, though taking this route should probably result in an LTV of 50%, or whatever figure stipulated in the latest round of cooling measures.
Have checked with my conveyancing legal contact.
There are only two options: transfer by sale or transfer by gift.
Transfer by gift for property with a charge (bank or CPF etc) is not possible. They have to be 'free of encumbrances'.
Transfer by sale - if your property has charge on it (bank or CPF etc), then the buyer (whoever it is does not matter, bro sis parent partner or what) has to either have the full ca$h and eligible to take another bank loan otherwise in order to 'buy' your property over. Plus it has to be at 'fair market value'. Meaning you can't sell it for $1 - the bank will not allow that. It has to be at a price determined by valuer.
Therefore, it is only possible provided whoever you are transferring it to be it relative or shell company, has the funds covering at least the market value of the property plus other fees like legal etc to 'take over'. Plus when you 'buy over' after the HDB 5 years MOP, you need to have the same amount of funds or maybe more (considering price rises) to 'take over' back.
So effectively if you want to 'sell and buy' to yourself - you need funds up to twice or more of the property value to do it.
But if assuming you have no charge on it, neither bank loan or CPF, then you may consider selling at $1 to yourself or shell company. However, don't forget next time when you really want to dispose of it, the bank may not value your property at fair market value. In fact you may bring down the whole development price point. ;)
Life Sux!!!
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