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I recently bought a condo unit @ $770K and bank valuation is the same amount. My bank loan is 80% of this. Will there ever be a time when the property market crashes and the bank suddenly valuate the property at, say, $600K. Woould the bank actually ask us to top up anything?
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3 Answers

Hi Joanne, it's a worthy concern and as you said, possible when market "crashes". It has happened before (but the banks usually look for the owners who always lag in paying monthly installments first). From time of purchase to "crash", hopefully your principal would have been paid off by a fair bit and bank will be more lenient, even if they re-value.

During such crisis, do reply when the bank tries to contact you - they are actually trying to work out a solution. If the bank officer can't get in touch with you, he will pass the case to other "not-so-friendly" departments, and that's when your problem gets bigger and bigger.

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