Hi,
Yes, your existing car loan and education loan can affect how much housing loan a bank is prepared to grant you, even if you are comfortable servicing each loan individually.
Under the Total Debt Servicing Ratio (TDSR) framework, your total monthly debt commitments, including the proposed housing loan, generally cannot exceed 55% of your gross monthly income.
For example, if your monthly income is $8,000, the maximum combined monthly debt commitment would generally be $4,400. If your existing car and education loans amount to $1,500 monthly, this leaves approximately $2,900 for the assessed housing loan instalment, subject to other lending requirements.
If you are purchasing an HDB flat, the Mortgage Servicing Ratio (MSR) of 30% also applies, which may further limit your borrowing capacity.
Since you are planning to purchase early next year, I would suggest obtaining an In-Principle Approval (IPA) from a bank before starting your property search. This will give you a clearer understanding of your borrowing capacity and help establish a realistic property budget.
May I know whether you are considering an HDB flat or private property, and whether this will be your first property purchase?
Also, have you engaged a property agent to assist with your purchase? If so, has your agent helped you assess your financing options and affordability before recommending properties?
I would be happy to help you work out a realistic purchasing budget and share some insights on suitable properties within your financial comfort level.
Geryl Lim
9278 7772
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