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Thread: Getting more than 80% housing loan possible?

  1. #1
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    Default Getting more than 80% housing loan possible?

    hello,

    I read the replies from agents in a local popular property site that they could obtain more than 80% loan for some of their clients. Is that actually possible? The banks I talked to seemed to be insistent that 80% is max for home loans. If the above is true, is there any other catch besides probably higher interest rates or lock-in periods?

  2. #2
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    Default DBS

    Try DBS. They can offer you up to 90% loan if it is for own stay. Of course the interest rate is also slightly higher.

  3. #3
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    Default Do your math

    By the way, why would you want to stretch yourself to make 90% loan? Can you afford to pay the monthly installment when interest rates go up?
    For example, if you have $100K, you can buy $500K house with $400K loan. If the interest rate is 2% and you pay it in 30 years, your monthly payment is about $1500.
    Now with 90% loan, you could buy a $1M house with $900K loan. Your monthly payment will be about $3300. Here are the what if for interest rate changes:
    2% $3326
    3% $3794
    4% $4296
    5% $4831
    6% $5395
    7% $5987
    8% $6603
    Are you still comfortable with your monthly payment? You cannot use the current historical lowest interest rate to calculate. The low interest rate wouldn't stay so low for 30 years.
    The worst thing is when interest rate goes up, stock market goes down, and likely property market. If you are forced to sell your house at $800K (20% property price drop is nothing), and you will loss everything and still own the bank $100K!
    Think twice before you make 90% loan. Thanks,

  4. #4
    teddybear's Avatar
    teddybear is offline Global recession is coming....
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    Default

    If he intends to keep the 10% for investment opportunities and buffer, then it is Ok since interest is so low now. (If the bank is willing to lend me 100% at such low interest rate I am also willing take - When interests goes up, I will repay more). I think DBS do give 90% loan. Not sure about the other banks.

    Quote Originally Posted by richwang
    By the way, why would you want to stretch yourself to make 90% loan? Can you afford to pay the monthly installment when interest rates go up?
    For example, if you have $100K, you can buy $500K house with $400K loan. If the interest rate is 2% and you pay it in 30 years, your monthly payment is about $1500.
    Now with 90% loan, you could buy a $1M house with $900K loan. Your monthly payment will be about $3300. Here are the what if for interest rate changes:
    2% $3326
    3% $3794
    4% $4296
    5% $4831
    6% $5395
    7% $5987
    8% $6603
    Are you still comfortable with your monthly payment? You cannot use the current historical lowest interest rate to calculate. The low interest rate wouldn't stay so low for 30 years.
    The worst thing is when interest rate goes up, stock market goes down, and likely property market. If you are forced to sell your house at $800K (20% property price drop is nothing), and you will loss everything and still own the bank $100K!
    Think twice before you make 90% loan. Thanks,

  5. #5
    Join Date
    Jul 2009
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    Default

    I was thinking of buying a pte pty to stay while trying to sell my HDB. Then when the sales proceeds come in frm the HDB sale, then I'll do partial redemption. I know there's something called bridging loan for such cases, but then I also heard the interest rate is high. Anyone got better suggestion?

  6. #6
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    Wow.. u guys are lucky to be able to get 90% loan..
    I'm only able to get 70% loan even though my investment portfolio has a value more than 300% of the property value. Sigh.. they say I not working ..so thats why i cnanot get those 80 or 90% loan.

  7. #7
    teddybear's Avatar
    teddybear is offline Global recession is coming....
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    You didn't show the banks your investment portfolio (original statement)? May be they will then reconsider?

    Quote Originally Posted by focus
    Wow.. u guys are lucky to be able to get 90% loan..
    I'm only able to get 70% loan even though my investment portfolio has a value more than 300% of the property value. Sigh.. they say I not working ..so thats why i cnanot get those 80 or 90% loan.

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