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Anonymous

22 Jun 2020

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Should i use CPF or cash to pay for my housing mortgage?

Hi, as i am getting my BTO flat soon, i was wondering if i should use cash to pay for my housing loan instead as i can keep the cash in my OA/SA to get the extra interest. Or is a combination of both better? E.g. using CPF and cash to pay for the loan to reduce the repayment period?

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Malvin Tan WP

22 Jun 2020

Writer at t.me/pwpfpodcast

In general I always hear people say use CPF. It hinges on your opportunity costs. Money is money, either in CPF or in Bank albeit the liquidity and limitations surrounding CPF Funds thats why most people will say CPF funds. I say use Cash provided you cannot generate a higher return than CPF interest rate.

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During BTO key collection, can I indicate to pay the mortgage using CPF-OA funds but repay my CPF-OA using cash every month / year? Will there still be accrued interest if I repay using cash monthly?

Buying a condo soon and will wipe out CPF OA balance for downpayment. Should I pay for the monthly mortgage in cash only (build up my OA balance) should I use CPF for the monthly mortgage?

Which is a wiser thing to do, use my CPF to pay for house or use cash? I am contemplating how to use my funds to the best capability.

Would you advise people to pay for their HDB mortgage using cash instead of using cpf?

Any downsides with using OA to pay housing mortgage and using the cash saved to voluntary top up SA?

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