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I do not quite understand what you mean here. Basically for downsizing of HDB unit, all CPF monies that have been utilised for the current flat will be refunded into their respective CPF accounts with accrued interest.

Supposing that both husband and wife have not met the retirement age, these amount will be back into the Ordinary Account.

When it comes to the purchase, given that 1 will be an owner and the other as essential occupier, CPF funds can only be drawn from the owner's CPF account to finance the property.

——

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Hi,
If you are downsizing, that means you are selling your current 4room flat and buying a 3room flat. These are 2 different transactions. So, you can use one name to purchase the 3 room flat, provided the buyer has sufficient cash, CPF and is able to take a loan. If the buyer has not taken a loan twice from HDB, the buyer can still do so. Otherwise, it will be a bank loan.

Please contact me so that I can be of further assistance.
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Elan Govan
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 90170747 
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Hi Do contact me at 97970200  to understand more and discuss.

Mark, your RIGHT choice
Propnex Read More

Good day to you.

Both of you share ownership of the current unit. When it comes time to sell, the selling price will first be used to pay off the outstanding mortgage. After that, the amounts you both contributed, through your CPF Ordinary Account (OA), along with the accrued interest, will be refunded to each contributor's account. Finally, any outstanding arrears, legal fees, and miscellaneous expenses will be settled. Balance will be your cash proceeds.

For your upcoming purchase, you will be the sole applicant with your spouse listed as an essential occupier. The HDB Flat Eligibility (HFE) will be evaluated based on your financial status, age, and the remaining lease term of the unit. If the loan on your existing unit is through HDB, you’ll need to use 50% of your cash proceeds from the sale. Your CPF OA will then be tapped into to help reduce the loan amount needed. The remaining balance, after accounting for the approved HDB loan, will need to be paid in cash. Additionally, if you are 55 years or older, you’ll need to ensure that the CPF minimum retirement sum is set aside. Is this the specific detail you were inquiring about?

Let's get together and work things out.

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If you are in the right property, it is unlikely that the accruing of interest via CPF will outpace the appreciation of your property.

Nevertheless, if you are not in the optimal property, as is the case for about 3000-5000 Singaporeans each year, you could end up in "negative cash sale" situation doing what you are considering.

This might cause you and your partner to end up even more financially strapped after selling your homes, due to the money that needs to be returned to your spouse (occupier's) CPF account after the sale as you have described above.

Given that your spouse may be unemployed, you do also need to thread carefully as you may not be able to get a new place after selling your old, if you are unable to the appropriate loan from HDB or a bank using only your name.

Since there appears to be multiple considerations in your situation, would be happy to schedule a session with you for me to run through how all the finances might look like, whether you stay in place or move.

I'm a Harvard graduated real estate agent with a degree in economics, and I have a decade of experience working on Singapore public policy. I do this completely FREE for you.

Do reach out below.

Kay Cloud
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Propnex Realty Pte Ltd
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Hi

I think you are referring to the utilization of 2nd HDB loan for your next flat? If yes, and if your current flat is joint borrowers of HDB loan, you are required to set aside 50% of your sale cash proceeds, utilize all your CPF OA refund plus accrued interest, as well as existing current OA available towards your next flat (this includes both you and your spouse), before any 2nd HDB loan amount is approved and disbursed.

However in your scenario, your 2nd HDB loan becomes sole borrower, which means the above clause mentioned will apply. If the occupier was required to use 100k CPF OA for the 2nd HDB loan to be approved, but instead now becomes the occupier, yes he/she is required to come up with 100k cash instead to cover this amount that would have been covered by this 100k CPF OA. Essentially HDB is saying we will only approve 2nd HDB loan up to the amount (as though both owners CPF OA are used and 50% sale cash proceeds from first house utilized), the balance (that you avoid using CPF) you have to use cash to top up.

If you go for bank loan, this will not be an issue. But a minimum 5% cash payment component applies. The above requirement is because HDB by default wants the buyer not to overstretch on the 2nd hdb loan, and the above mechanism will help the buyer to apply prudence when purchasing next flat.

I can do some detailed calculation for you so you know what to expect for both hdb and bank loan scenarios. Bank loan now has become more appealing as its rates have reached 2%, lower than HDB's concessionary rate of 2.6%

Hope the above clarifies. I am well-versed with HDB and private property transactions, having helped more than 100 homeowners transit smoothly with their housing plans. Please reach out to me at 97432395  for a more in-depth discussion :)

May I have more info on your requirements so as to make better recommendations? Thanks and looking forward to chat more

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Cheers
Stewart-PropNex (Senior Associate Division Director) Read More

Hi,

1) I guess you didn't fully understand what the statement is trying to say.
2) This is a reminder to the sole owner has to take up the full financial responsible to pay for the purchase rather than having an assistance from the spouse/fiance/fiancee who's CPF fund could be utilized for this purchase if spouse/fiance/fiancee is listed as a co-owner.
3) This has nothing to do with HDB loan or bank loan.

All The Best!!!

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Hi Sir/Mdm,

This is applicable if you are taking a HDB loan for the downsizing. Before lending you the funds, HDB will require you to top up your spouse CPF OA in cash and also you are required to use 50% of your sale proceeds towards your next housing.

However, if you are taking a bank loan, this is not a requirement. I have personally assist my clients who are in the same situation, sell their place and purchase another under an owner- essential occupier arrangement.

You will need proper planning in terms of the finances since only a single income can be use for the loan assessment and only the owner's CPF can be used. We will also need to plan the timeline so that you are able to transit smoothly and seamlessly from one place to another without the need for an interim housing solution.

Please feel free to contact me so that I can understand your situation better and assist you further!

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Selling our house was a pretty stressful ordeal, as we have already committed to buying our new home and hence have a timeline to meet. Losing a substantial deposit and worse still, not getting our dream home caused many sleepless Read More

I would be glad to assist you.
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Hope to hear from you soon.
Pei Mobile: (65) 9 7 1 0 0 1 5 5.
Email: peicheng.tan@propnex.com
Associate Group Director
Propnex Realty Pte Ltd Read More

Good question — this part of the HFE often causes confusion.

What HDB means is: if one party is listed only as an essential occupier (instead of a co-owner), then their CPF OA funds cannot be used for the flat purchase. In that case, the buyer (main applicant) must be able to cover the purchase price as if the occupier’s CPF wasn’t available. That’s why HDB states you need to “have sufficient cash/CPF to cover the spouse’s OA balance which could have been used”.

It doesn’t mean you literally have to fork out the same amount that’s in your spouse’s CPF OA (e.g. $100k in OA = you must pay $100k cash). Instead, it means you must have enough resources (your own CPF/cash, plus any loan) to finance the flat without touching your spouse’s CPF.

This rule applies regardless of whether you’re taking an HDB loan or a bank loan — it’s tied to ownership structure, not the lender.

If your goal is to let CPF flow back and grow in OA, that’s possible, but the key is whether the remaining applicant can comfortably finance the flat. I’d suggest you run through a financial plan first, because downsizing should ideally free up cash instead of straining liquidity.

If you want, I can help you do a proper breakdown with actual numbers based on your flat’s value and intended purchase — just drop me a message.

Aren Goh | PropNex | 96576701  Read More

1. For a 2nd HDB loan, HDB calculates as if:

* Both owners’ CPF OA are fully used
* 50% of cash proceeds from the first flat are applied
* Any shortfall (if you withhold CPF use) must be covered in cash

2. With a bank loan, this rule does not apply, but you must pay at least 5% in cash upfront.

3. HDB’s approach is meant to prevent buyers from overstretching financially and to encourage sensible budgeting for the next flat.

As Warren Buffett once said, “Do not save what is left after spending, but spend what is left after saving.”
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