How to Pay for a Resale HDB Flat: A Step-by-Step Guide

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You’ve found the perfect resale HDB flat as your new home, and a seller who is agreeable to sell it to you (if you haven’t, check out our Guide to Buying a Resale HDB flat here!)

Unfortunately, just an agreement between the buyer and the seller is not going to seal the deal. 

In this comprehensive guide, we will discuss the costs and fees  that a buyer of a resale HDB flat needs to pay (in addition to the unit’s selling price), as well as the application process. 

Read on further for a step-by-step guide on using the new HDB Resale Portal, which is now the only platform where you can carry out the transaction. We will also discuss the things that both buyer and seller need to do prior to completing the resale transaction, and what happens after.

 

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A Breakdown of the Costs and Fees Involved when Purchasing a Resale Flat

While the purchase price is easily the first thing to prioritise when buying a resale flat, there are other fees outside of the purchase price that you have to take note of:

Administrative fee for Temporary Extension of Stay

If it is agreeable for seller to prolong their stay temporarily, an admin fee will need to be paid for by the buyer to HDB 

$20

Property agent's commision

Applicable if transaction was through an agent

Typically 2% by seller, 1% by buyer (depends on the agent)

Resale application fees

Admin fee required by both buyer and seller to HDB 

$40 for 1- and 2-room flats, $80 for 3-room and bigger

 

It is also important to note that the costs and fees differ should you decide to take up an HDB loan or a bank loan.

Let’s use newlywed Singaporean couple James and Lily who are purchasing their first residential property as an example.

  • Combined income: $6,500 per month
  • Combined CPF savings: $35,000
  • Property type: 3-room HDB resale flat
  • Unit’s Selling Price: $450,000

If they have taken up an HDB loan

With the new CPF Enhanced Housing Grant (EHG), the couple is allowed to receive $30,000 in grants. In addition to that, they can also receive $50,000 in grants (CPF Family Grant). 

They intend to mostly fund the acquisition with a 25-year HDB loan amounting to $390,000. They also plan to repay their mortgage instalments utilising their CPF monies.

Assuming the couple intends to apply for an HDB loan, below is a breakdown of their payments.

Deposit (includes booking fee)
$5,000.00
Cash
Valuation fee
$199.25
Credit card
Resale application administrative fee
$80
Credit card
Stamp duty on option (based on $450,000 flat price)
$8,100.00
Cash/CPF
Stamp duty on mortgage
$500
Cash/CPF
Conveyancing fee for OTP (based on $450,000 flat price)
$423.9
Cash/CPF
Conveyancing fee for Loan (based on $390,000 loan amount)
$369.9
Cash/CPF
Registration and microfilming for transfer of ownership
$38.3
Cash/CPF
Registration and microfilming for housing loan
$38.3
Cash/CPF
Buyer’s caveat
$64.45
Cash
Mortgagee’s caveat
$64.45
Cash
Title search fees
$10.4
Cash
CPF Home Protection Scheme (HPS) mortgage insurance
$238.29
CPF
Fire insurance
$4.5
Cheque
Flat selling price (to be paid by HDB loan; 90% Loan-to-Value)
$390,000.00
Loan
Flat selling price (to be paid by CPF savings)
$35,000.00
CPF
Flat selling price (to be paid by CPF grants)
$25,000.00
CPF
Total
$465,131.74
 

 

As shown above, the buyers will need to pay about $15,132 in cash, given that the HDB loan, CPF savings and grants would only cover the selling price of the flat or $450,000. Please note that HDB loan will be first deducted from CPF Savings, before paying for the rest.

DISCLAIMER: The above table is only intended to give buyers an idea on how much they need to pay for an HDB resale flat. To get a more accurate financial breakdown, please use the HDB resale portal.

 

If they have taken up a bank loan

Everything else being the same as the above situation, let us assume the couple qualified for the maximum Loan-to-Value (LTV) ratio of 75%. This means they can only loan $337,500 to buy the $450,000 flat. They also engaged an external lawyer to assist them with the deal, particularly with conveyancing. For this, the couple agreed to pay the attorney about $2,800 for his legal service. Below is the financial breakdown of the transaction.

 

Deposit (includes booking fee)
$5,000.00
Cash
Valuation fee
$199.25
Credit card
Resale application administrative fee
$80
Credit card
Stamp duty on option (based on $450,000 flat price)
$8,100.00
Cash/CPF
Stamp duty on mortgage
$500
Cash/CPF
Legal fees
$2,800.00
Cash
CPF Home Protection Scheme (HPS) mortgage insurance
$238.29
CPF
Fire insurance
$4.5
Cheque
Flat selling price (to be paid by bank loan; 75% Loan-to-Value)
$337,500.00
Loan
Flat selling price (to be paid by CPF savings)
$35,000.00
CPF
Flat selling price (to be paid by CPF grants)
$25,000.00
CPF
Flat selling price/ other fees (to be paid in cash)
$52,500.00
Cash
Total
$466,922.04
 

 

The overall cost is roughly the same compared to using an HDB loan, but the couple will need to pay more money out of their own pocket, as their CPF savings, CPF grants and bank loan only total $397,500, given the 75% LTV.

DISCLAIMER: The above table is only intended to give buyers an idea on how much they need to pay for an HDB resale flat. To get a more accurate financial breakdown, please use the HDB resale portal.

 

Resale Application procedure

Now that you’ve understood and chosen how to finance your flat, it’s time for the application. According to the HDB website, here are the nine steps in the buying/selling journey:

  1. Register Intent to Buy
  2. Search for Suitable Flat and Get Option to Purchase (OTP)
  3. Choose Mode of Financing
  4. Submit Request for Value to HDB
  5. Submit Resale Application
  6. Acknowledge Resale Documents
  7. Pay Fees (Online Payment)
  8. Approval of Resale
  9. Completion of Resale

Later in our step-by-step guide below, we will be following you through these nine steps.

Relevant guides to read before the resale application process: 

 

Documents and information required for Resale Application

  • OTP details
  • Full address of the resale unit
  • Particulars of: Sellers, Buyers, Occupiers
  • Intention to apply for any grants (CPF Housing Grants or Proximity Housing Grant)
  • Intention to finance with a loan (HDB loan or bank loan)
  • Manner of Holding of HDB unit
  • Any declarations regarding the purchase

When must you submit the Resale Application?

After you have exercised the OTP, the buyer and seller will need to submit the resale application within seven days of each other’s application. 

That is to say, you will have to communicate with your buyer/seller to agree on a timeframe for your respective submission of application. If not done properly and the application period lapsed, you will have to restart the entire process again.

 

HDB Resale Portal: a Step-by-Step Guide 

As of 1st January 2018, those buying and selling second-hand public housing are required to use the HDB Resale Portal to conduct their transaction.

This shortens the entire resale process to just eight weeks as long as the necessary documents are submitted accurately and on time. Also, instead of having two appointments where the seller and buyer are required to personally appear before HDB, both parties are now only required to attend one appointment to complete the resale application and sign the documents that need “wet ink” signatures.

Aside from being guided step-by-step through the resale process, both parties don’t have to manually input their particulars as the application forms will automatically populate the details using the government’s MyInfo service.

Via the portal, you will instantly know your qualifications to buy a flat, as well as to get housing grants and HDB concessionary housing loan.

Other key info like Ethnic Integration Policy quota, upgrading status, upgrading costs billing status, and recent resale flat transactions in the vicinity are also incorporated in the website.

To help you, PropertyGuru has listed the key steps in using the HDB Resale Portal.

 

1. Register intent to buy or sell. For the buyers, he must register Intent to Buy before the seller grants OTP. For the seller, he needs to register Intent to Sell at least seven days before granting OTP.

image1

 

2. Look for an HDB resale flat you want and get an OTP. You can check PropertyGuru’s HDB resale listings. Once you have received an OTP, you have 21 days to exercise it. Please note that buyers who qualify for and intend to obtain a mortgage from HDB need to have a valid HDB Loan Eligibility (HLE) Letter before the sellers can grant them an OTP. It is advisable that the buyer get the HLE Letter even before looking for a resale flat.

3. Choose mode of funding purchase. If you’re the buyer, you need to decide how you will pay for the transaction either through cash, CPF savings, and/or housing loan from HDB or private bank. If you want to apply for an HDB housing loan, the portal will guide you to get for an HLE Letter.

image2

 

4. Request value of flat from HDB. If you are funding the purchase with CPF monies and/or housing loan, you need to submit a Request for value of flat from the Housing Board to determine the loan amount and the how much CPF savings you can tap. You also need to pay a processing fee of $120 (inclusive of GST).

Please note that buyers can only request for valuation after getting the OTP. You need to submit the first page of the prescribed OTP form and Request for Valuation to HDB by the next working day after the OTP date.

If HDB needs to conduct a valuation of the flat, an appointed valuer will inspect the unit within three working days after informing the seller. The buyer can check the valuation at the HDB Resale Portal within 10 working days from the inspection date.

image3

 

5. Buyer and seller submit resale application. After the buyer exercises the OTP, both parties need to submit their respective parts of the resale applications with supporting documents to the HDB Resale Portal. Each will need to pay an administrative fee based on the unit being purchased.

After getting the application, the Housing Board will confirm the information and notify both parties of the application result, typically within eight weeks.

image4

 

6. Acknowledge resale documents. The Housing Board will calculate the necessary payments and prepare the documents to be acknowledged by the seller and buyer in the website. Both parties need to endorse documents within six days.

image5

 

7. Both parties pay a resale fee. The unit seller and buyer each needs to pay online for the legal and stamp fees via the HDB Resale Portal.

image6

 

8. Await the Housing Board’s approval. HDB will inform both parties once it has given its approval for the resale application, with the approval letter available on the website.

image7

 

9. Both parties attend completion appointment. Seller and buyer need to attend the appointment at HDB Hub to conclude the resale deal.

But before completing the resale transaction both parties need to do the following:

For sellers:

1. Rectify/remove any unauthorised renovation works in the resale unit and verify the rectification with HDB.
2. Close the GIRO account pertaining to the resale flat.
3. Ensure the property tax and service & conservancy charges are paid up to the effective date of resale deal.
4. Leave the premises to ensure the buyer gets vacant possession of the flat upon completion of the deal.
5. Let buyer inspect property.

For buyers:

1. Inspect resale unit to make sure it’s vacant and its physical condition is acceptable before taking ownership.
2. Pay the balance of the purchase price (if any) with Cashier’s Order or NETS.

 

Completion of resale transaction

Once the transaction is completed, the buyer will get a confirmation letter of ownership permitting him to apply for water and electrical connection. A renovation permit will also be issued.

The refunding of the seller’s CPF monies will also be arranged by the Housing Board to be credited back into his CPF account within seven working days from the date of completion of the resale transaction.

 

More FAQs related to purchasing a resale HDB

How much do you pay upfront for a resale HDB?

A deposit of up to $5000 is paid to the seller in two stages - 1) Up to $1000 at the granting of OTP, and 2) Up to $4999 when exercising of OTP.

Can I use CPF to pay for a resale flat?

Regardless of whether you take up an HDB loan or a bank loan, you may use your CPF to pay for certain parts of the costs and fees involved when purchasing a resale flat, but not for the full process. 

How can I avoid paying resale levy?

You do not have to pay a resale levy if you are purchasing your first subsidised HDB flat. Read more about HDB resale levy here.

 

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