RES exam question on HDB Policies: cash does she receive once the loan is repaid and her CPF is refunded
Mdm Lee sells her 4-room flat for $620,000; HDB's valuation was $605,000. Her outstanding HDB loan is $80,000. She used $170,000 of CPF Ordinary Account savings for the flat, and the accrued interest on it is $32,000. What cash does she receive once the loan is repaid and her CPF is refunded?
- A$370,000
- B$323,000
- C$540,000
- D$338,000
Show answer & explanation
Answer
D. $338,000
Explanation
Answer: $338,000. The loan is repaid first, then the CPF used plus accrued interest is refunded to her CPF Ordinary Account.Working:1. CPF refund: $170,000 + $32,000 = $202,000.2. After the loan: $620,000 − $80,000 = $540,000.3. Cash: $540,000 − $202,000 = $338,000.Watch out: The refund goes back into her own CPF Ordinary Account, not to HDB, but it still does not reach her as cash.Rule: On a sale the outstanding housing loan is repaid first. The CPF savings used for the flat are refunded to the owner's CPF account with accrued interest, so the cash received is less than the headline price.Source: CPF Board, refund of CPF used for housing; /learn/cpf-housing-grants-and-hdb-resale, current at 1 Oct 2026
Why the other options are wrong
- $370,000: Leaves the $32,000 accrued interest out of the refund.
- $323,000: Works from the valuation, but the buyer pays the sale price, not the valuation.
- $540,000: Deducts only the loan and skips the CPF refund.
Study the concept behind this question: CPF Housing Grants & the HDB Resale Process
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