Asked on 03 Aug 2020
Hi, I'm recently looking at purchasing a property and noted that there's a maximum amount that I can borrow according to the TDSR calculation. I'm not sure if insurance and savings plan premiums are considered as monthly debt obligations, anyone knows? Thanks!
Your total debt is always attached to a financial institution or borrower, and the details can be obtained through obtaining your credit score. The maximum amount you are able to borrow is dependent on your income, as well as the value of the property you are looking at currently. Should you have any outstanding loans, those will be reflected in your credit score as well.
Insurance premiums are not considered debt obligations, as they are paid via your liquidity. Should you not be able to service your policies, you will not owe the insurer per se, as the policy would either tap into its value or terminate.
Hope i was able to answer your queries!
Of course not. Those policies are not debt obligations UNLESS, you borrowed money to buy them, which may include leveraged annuities or whole life policies.
Otherwise, only debt like a mortgage or a car loan, a credit card debt, education loan, personal loan, renovation loan, would count towards TDSR.