Anonymous

03 Nov 2020

∙

If I have a sum of excess cash, is it better to do a partial hdb loan repayment or a refund to Cpf OA?

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Jiayee

03 Nov 2020

Salaryman at some company

Partial hdb loan repayment: You reduce the 2.6% p.a. interest and reduce new occasions for the phantom 2.5% p.a. interest to build up.

Refund to CPF OA: You reduce the phantom 2.5% p.a. interest that will materialise when you sell your unit but the 2.6% p.a. interest from your loan still rolls.

The first option makes more sense to me.

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What is your opinion on using only cash every month to pay for hdb loan repayment instead of using full OA CPF to pay hdb loan every month?

If I buy a resale HDB before selling and take a 2nd HDB loan, between the refund to CPF and HDB wipe out of OA, can I transfer part of the OA to SA? Or must all refunded CPF go to the new HDB loan?

In my 30s and on a 25-year HDB loan of 350k paid monthly through CPF, should hit FRS by my 40s. Is it sensible to pay the HDB loan thru excesses in OA once I hit FRS, instead of getting a bank loan?

I’ve been repaying my housing loan in cash as the interest rate was less than 1.8%. However, I’m repricing to a fixed rate loan at 2.65%. At this rate, it better to repay the loan with CPF?

Should priority be given to clear our HDB housing loan using cash (which can be paid off from the CPF OA over 20 years), or to use this cash for investment or CPF top-ups to the SA ?