Paper 2 · Financing
Property Financing in Singapore: LTV, TDSR & MSR
Must-know for the exam
- Loan-to-Value (LTV) caps a bank loan as a percentage of the property's price or value; the rest is the downpayment, part of which must be paid in cash.
- MAS caps a first bank housing loan at 75% LTV with at least 5% cash; a second loan drops to 45% and a third to 35%, each with 25% cash.
- LTV falls to 55%, 25% or 15% if the tenure exceeds 30 years (25 for HDB) or extends past age 65; first-loan minimum cash then rises to 10%.
- The HDB concessionary loan LTV was cut from 80% to 75% on 20 Aug 2024, and its 25% downpayment may come wholly from CPF Ordinary Account with no minimum cash.
- Under MAS rules, TDSR caps all monthly debt repayments, including car loans and credit cards, at 55% of gross monthly income and applies to every property type.
- MSR caps only the housing loan at 30% of gross monthly income and applies solely to HDB flats and an EC bought directly from the developer.
- Private property and a resale EC bought on the open market are assessed on TDSR and LTV only, with no MSR
Three rules decide how much a buyer can borrow from a bank. The exam tests which applies where and how they interact — the exact percentages are policy levers (confirm with MAS), but the structure is stable.
1. LTV — how much you can borrow against the value
Loan-to-Value (LTV) caps the loan as a % of the property price/value; the rest is your downpayment (part of which must be cash). LTV drops sharply for a second/third loan, and is also reduced if the loan tenure is long or extends past age 65.
Premium
Every lesson. Every question. One pass.
6 more sections of this lesson are part of Premium.
- Every section of every lesson
- All 2,600+ practice questions
- Full timed Paper 1 & 2 mocks
- A worked explanation on every question
- The AI tutor, for any concept you're stuck on
- Your full mistake bank and weak-area review
From ≈$14.98/mo on the 6-month pass
Ready to test yourself?
Practise exam-style questions on Financing — with instant answers and explanations.
Practise Financing questions →Exam-style questions on this topic
- RES exam question on Financing: A Singapore Citizen considers refinancing the mortgage on the private condominium he…
- RES exam question on Financing: A borrower's loan is stress-tested and capped by several rules
- RES exam question on Financing: A buyer funds a private condominium with a bank loan and CPF
- RES exam question on Financing: Daniel and Serene are married Singapore Citizens, both aged 44
- RES exam question on Financing: A buyer assembles the cash/CPF for a $1,500,000 private condo with his first bank…
Common questions
- Does MSR apply to private property in Singapore?
- No. The Mortgage Servicing Ratio applies only to HDB flats and to an Executive Condominium bought directly from the developer. Private property — and a resale EC bought on the open market — is assessed under TDSR and LTV limits instead. Confirm the current position with MAS.
- What is the difference between TDSR and MSR?
- TDSR caps your total monthly debt (all loans) against income and applies to all property types; MSR caps only the housing loan against income and applies only to HDB flats and to an EC bought directly from the developer. A resale EC is therefore TDSR-only, like private property.
- What are the CPF Valuation Limit and Withdrawal Limit?
- They cap how much of your own CPF can go into a property, separately from the bank's LTV. The Valuation Limit is the lower of the purchase price or the valuation at the time of purchase, and CPF may be used up to it. The Withdrawal Limit is 120% of the Valuation Limit — CPF may only be used beyond the VL, up to the WL, if you have set aside the Basic Retirement Sum, after which instalments must be paid in cash. Both cover the downpayment plus every monthly instalment, and how much CPF can be used at all also depends on the remaining lease. Confirm current limits with the CPF Board.
Keep learning
- OTP Singapore: Option to Purchase Fee, Period & Exercise
- Stamp Duties Explained: BSD, ABSD & SSD (Singapore, 2026)
- Executive Condominiums (ECs): MOP, Privatisation and the May 2026 Changes
- Fee Simple vs Estate in Perpetuity vs 99-Year Leasehold
- Home Protection Scheme (HPS) & HDB Fire Insurance Explained
- Property Valuation: The 5 Methods (with worked examples)
- Home Loan Rate Types & Refinancing (fixed, floating, SORA)
Related exam guides
Explore more
Get each day's lesson free — one RES topic + the trap, every day on Telegram.
Join @resprepsg →Study material aligned to the public CEA syllabus. Not financial or legal advice — verify current figures with the relevant authority (IRAS, HDB, CEA, MAS).