We used CPF to pay HDB. But after we fully paid using CPF after 25 years loan, we sell the house to buy another, why are we still paying the interest in the loan when the CPF money should belong to us? What do you guys think? - Seedly
 

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Asked by @@ Lim

Asked on 02 Mar 2019

We used CPF to pay HDB. But after we fully paid using CPF after 25 years loan, we sell the house to buy another, why are we still paying the interest in the loan when the CPF money should belong to us? What do you guys think?

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Gabriel Tham
Gabriel Tham, Tag Team Member at Kenichi Tag Team
Level 9. God of Wisdom
Answered on 02 Mar 2019

U are not paying to cpf. U are paying to yourself the interest u would have earned if u didn't use cpf for house.

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This is why the speakers are recommending to not use cpf for house if possible. Because not only you have to put back the accrued interest yourself, you also lose out the interest that CPF gives you. You dont just simply lose 2.5%.

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Aaron Tng
Aaron Tng
Level 2. Rookie
Answered on 10 Jun 2019

I think another way of looking at it is that the money within CPF is your own money. Instead of investing in CPF, you are investing in the house. The interest is just the expected returns from investing in the property. So any gains from the sales are back to your CPF.

I think it is just a matter of really poor marketing, calling it CPF loan. In essence, you are using your money to buy your own house, and returning the money you took out from your CPF account, and giving some of the gains back to your CPF as a return on investment.

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Grace Cong
Grace Cong
Level 5. Genius
Answered on 03 Jun 2019

You're paying yourself the interest that CPF would have paid to you had you not used OA to purchase the flat. So it's still your CPF money at the end of the day. You can use it for your next purchase, right?

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Randall Tan
Randall Tan
Level 5. Genius
Answered on 23 Apr 2019

Yes it belongs to us, that is why the interest goes back into our CPF account. This way, we will have enough for our retirement.

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Teo See Hwa
Teo See Hwa, MArketing Associate at Propnex
Level 5. Genius
Answered on 17 Apr 2019

Why wait for 25 years when MOP is only 5 years?

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Chen Zhirong
Chen Zhirong
Level 5. Genius
Answered on 02 Mar 2019

Pay with cash and no interest

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