4 Answers

askguru expert
Hi MKZL, thanks for writing to us on AskGuru.

For condos that are under development, you can look to progressively make payment for a few years until the project is completed. You still have to pay a booking fee of 5% in cash and the remaining 15% in cash or CPF in the coming weeks after which the progressive payment scheme will kick in.

For resale condos, you will need to pay 1% upfront to the seller after securing the Option to Purchase. You then have two weeks to exercise the option and pay the remaining 4% in cash. The remaining 20% can be via your CPF. Do note that the Loan-To-Value (LTV) limit is currently 75% for a Singaporean citizen buying their first private property. You may refer to our link here for more details: https://www.propertyguru.com.sg/property-guides/how-much-do-you-need-to-spend-upfront-when-buying-a-condo-10413

There are also other transaction costs such as the following:
1. Banking costs - interest cost and pre-payment charges
2. Related taxes - stamp duties for a contract, mortgage, pro-rated property tax
3. Legal costs - conveyancing fees
4. Other closing costs - valuation fee, caveat fee, agent's fee

Here are examples of bank charges and fees:
1. Pre-payment of capital sum
Buyers must give 30 days prior written notice or payment in 'interest in lieu' in the minimum of $10,000 and in multiples of $1,000.
2. Pre-payment fee
In the event that pre-payment is made within the 'lock-in' period from the date of the first loan disbursement, a pre-payment fee of 1.5% of the ledger balance will be charged.
3. Redemption
Borrowers must give 3 month's written notice or payment of 'interest in lieu'
4. Redemption fee
1.5% of the amount redeemed will be charged if made within the 'lock-in' period from the date of the first loan disbursement date.

Related taxes:
1. Stamp duty.
Assuming, you are a Singaporean, for a $1.5 million condominium, your stamp duty will be $44,600. Refer to IRAS's calculator here: https://mytax.iras.gov.sg/ESVWeb/default.aspx?target=MSDCalculatorIntro
2. Pro-rated property tax
This is assuming you are buying a resale condominium. When the property is sold, the buyer will share the portion of the property tax that is not 'used' by the seller. Do note that all property taxes are paid in advance in January. For example, if the full year property tax is $600 and the property transaction is completed on the last day of June 2020, you will share with the seller the property tax amount proportionate to the percentage of the year that each has ownership of the property. In this case, you will have to pay $300, being 50% of the property tax already paid by the seller in the beginning of the year.

Legal costs:
The standard rate for conveyancing fee charge on a private property transaction is 0.4% of the transacted price or up to $2,500, whichever is lower. Some lending banks absorb legal fees on the condition that the loan is not fully redeemed before maturity.

Other closing costs:
You may also pay for other related charges such as:

1. Valuation fees
In general, a purchaser must fork out the valuation fee for the property appraisal done on request of the mortgagee bank, and/or CPF Board (if CPF savings is used to purchase the property). In general, for private residential and non-residential properties, the valuation fee is between $400 and $500 but it could be higher in some cases when the licensed appraisers are required to perform more tasks related to the appraisal, for example, floor space measurements. Some lending banks absorb the valuation fees on the conditions that there is to be no full resumption before the loan matures.

2. Insurance premium
There are various type of property-related insurances inducing fire insurance and 'mortgage reducing' insurance. Most lending banks require the security to be protected with at least a fire insurance. However, not all lending banks require the security or loan amount to be insured. When the loan amount is insured, it is often called 'mor Read More

0

J.A. Goh 吴永益
Hi MKZL,

For new launched Condo:

Booking Fee - 5% (Cash)
Next is 15%, either CPF or Cash or combined. This will be about 10 weeks later.
Subsequent will be 80% bank loan, whereby progressive payment applied. Bank will start your installment once they dispense a certain payment to the developer.

For resale is about the same, expect that in the beginning is 1% option fee, followed by 4% within 14 days when you exercise the Option.

Please feel free to drop me an email or call me directly for further discussion.

Thanks & Best Regards
J.A.Goh - ERA
HP: 9639 0350
www.gohjaERA.myweb.sg
Email: gohja@singnet.com.sg Read More

1

Clinton Lim
Hi MKZL,

For condos under construction, there's the progressive payment scheme applicable in newer condo developments. The amount of loan progresses as the construction gets underway. It's a very slow and steady process throughout the couple of years of construction.
If you've set eyes on one, be prepared to fork out the 5% booking fee followed by the remaining 15% months ahead. The subsequent progressive mortgage payments will then kick in.

Not forgetting the Stamp duties as mentioned by what Darren.

In the resale market, the initial 1% will be handed over to the seller to obtain the OTP. After which you'll be given approx 14 days to exercise the option with the remaining 4% presented. You're required to settle you mortgage matters with your respective bank and CPF fundings within the 14 days. Engage a lawyer and he/she will guide you through the process including the bank applications and CPF fundings etc.
Hope the above helps.

I'm living in the AMK area. There's currently only Grandeur 8 and Centro Residence (construction) around this vicinity.
Not far away in Yio Chu Kang are Bullion Park, Castle Green, Nuovo, Far Horizon, Seasons Park and Thomson Grove.

Should you need any assistance in getting one. Please feel free to drop me an email at clintonlimzj@hotmail.com
I can also be reached at 94523347.
Hope to hear from you soon!
Have a nice day! Read More

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  • KM
    Can you explain what it means by Progressive Payment while the Condo is being constructed.
Mani Subramanian Veeramani
Hi

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