Asked on 21 Nov 2020
People usually take up hdb loan... Can't really find the exact timeline and procedure for it.
When do we apply for bank loan?
What if we can't get full loan amount for bank loan?
Will it be the same as HDB loan? When close to key collection, bank will reassess our income and get higher loan amount?
From your question, I'm guessing that you've applied for a flat during the November 2020 BTO Sales Launch?
Here's the rough timeline to expect (might vary a bit due to COVID-19):
1) About 3 weeks to a month after the application period closes, you'll be informed of the outcome of the ballot.
2) Depending on your ballot queue position (the smaller your number, the sooner you'll visit HDB Hub), it'll be about 1 to 2 weeks before you book your flat (aka choose your unit).
If you intend to take an HDB loan, you'll need to produce a valid HDB Loan Eligibility (HLE) letter at this point.
If you want to go with a Bank loan, you have until before you sign the Agreement of Lease. That's usually like within 4 months from booking your unit.
3) Signing of Agreement of Lease is, like I mentioned earlier, about 4 months from the booking of your flat.
At this point, you'll definitely need a valid HLE from HDB or a Letter of Offer from the bank.
4) Lastly, in about 3 - 7 years' time (depending on your HDB BTO project) is when your BTO flat will be ready and you'll head down to HDB Hub again for your key collection.
If you're afraid that you can't get a sizeable bank loan right now (maybe coz you and your partner's incomes are still low eg. fresh grads or still studying)... you can always go with an HLE first.
Then when you're about to sign the Agreement for Lease, you can apply for a bank's Letter of Offer instead. By then you would have a bit more time to build up a more robust credit rating and income, and the banks will be more willing to lend you more.
All you have to do is inform the HDB Officer of your intention to switch to a bank loan instead and they'll process it for you.
Hope this helps!
Before you select your BTO unit, you will have to decide if you're going for an HDB loan or a bank loan (or even no loan!). This is because you at least need to have the HDB Loan Eligibility (HLE) letter when you select your unit if you're choosing an HDB loan.
If you choose to go with a bank loan, you will have up to the signing of Agreement of Lease to decide which bank to get the loan from (this is about 1-2 months after you have selected your flat, so no rush). Do consider consulting a mortgage broker like Mortgage Master for advice (our service is free and no obligation) on the best home loans offered by the banks.
If you have gone with a HDB loan, you can refinance from a HDB loan to a bank loan about 6 months after loan disbursement (i.e. after you've collected your keys). Note that once you refinance to a bank loan, you will not be able to revert to a HDB loan.
If for any reason you cannot get the full amount from the bank, then of course you will need to pay the difference in cash and/or CPF.
Due to MAS regulations, banks can only loan up to 75% of the property's value.