RES exam question on Financing: A 54-year-old buyer wants to use CPF for a resale flat
Case study — A 54-year-old buyer wants to use CPF for a resale flat. The remaining lease is 39 years. He intends to pay part of the price from CPF. Evaluate the statements: (i) Full CPF use generally requires the buyer's age plus the remaining lease to be at least 95 (ii) Here 54 + 39 = 93, so CPF use is pro-rated (iii) Some CPF may still be used because the remaining lease is at least 20 years (iv) No CPF at all may be used because the total is below 95 Which statements are CORRECT?
- A(i), (ii), (iii) and (iv)
- B(i), (ii) and (iii) only
- C(ii), (iii) and (iv) only
- D(i), (iii) and (iv) only
Show answer & explanation
Answer
B. (i), (ii) and (iii) only
Explanation
(i) is correct: full CPF use generally requires the buyer's age plus the remaining lease to be at least 95. (ii) is correct: here 54 + 39 = 93, which is below 95, so CPF use is pro-rated rather than full. (iii) is correct: some CPF may still be used because the remaining lease is at least 20 years. Hence (i), (ii) and (iii) only. The age-95 and 20-year remaining lease rules apply to purchases from 10 May 2019 (CPF Board/MND).
Why the other options are wrong
- (iv) is wrong: CPF is not barred entirely just because the total is under 95, as pro-rated use is allowed.
Study the concept behind this question: Home Protection Scheme (HPS) & HDB Fire Insurance Explained
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