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Asked on 16 Jun 2020

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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Answers (1)

Malvin Tan WP

Malvin Tan WP

Level 5. Genius

Answered on 22 Jun 2020

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.


Market Uncle

09 Oct 2020

If one is confident they can grow their money higher than CPF rate, by all means use CPF for housing. Though the often cited reason of having to pay back their CPF is a showstopper, it is not a problem if one stays in their HDB and don't downgrade to a smaller condo. It is quite impossible to outlive a BTO anyway :)

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