Congratulations! You are now financially capable of acquiring your own home. So, you fell in love at first sight at a dwelling set in a certain neighborhood that you know will be close to perfect in raising a family in your near future.

But hold on in there for a moment. Before you apply for that housing loan or pay off the down payment with your hard-earned income, you need to consider a few matters. Acquiring a house is maybe going to be the most expensive purchase you are going to have in your life, after all. You would not wish to regret this decision.

In intending to buy a first house, most people are governed by their feelings. These people have a tendency to have a blind spot for important matters regarding the house they think is already the house of their dreams. Then, when the dust settles after move, they discover themselves disillusioned and frustrated with their first house.

Thus, here are some matters to consider in choosing and purchasing a house to call your own.

1. Consider the neighborhood

A neighborhood may appear safe and welcoming when you first saw the place. If planning to buy a private property, try visiting the neighborhood at different times of the day to see the overall comings and goings in the area.

2. Consider the community

We know that we could safely rear our kids in a neighborhood where residents take care and look out for each other.

3. Consider the structural defects

The dwelling you are seeing could be the house of your dreams. Nonetheless, it is still prudent to inspect the house for indicators of defects, plumbing issues, or the presence of pest infestations.

4. Consider the space

If see yourself building a family in the future, you have to choose a dwelling that has enough rooms for all family members.

5. Consider the price

Before you will be approved for a housing loan, a banking or lending institution will appraise and assess your credit track record, your income, your employment background, and your assets. Ensure that you secure a pre-approval of the mortgage so that you are aware if you could afford the house of your dreams.

Learn more about a premier housing loan advisory firm, providing housing loans with free mortgage broking.

Foreigners staying in Singapore for extended periods of time may discover that living in a hotel for the length of their stay can be very costly. The alternative answer to this problem is for the expats to purchase residential properties in the country.

Singapore authorities do not discourage expatriates from buying residential properties in the country.

The Residential Property Act of Singapore essentially supports Singapore nationals in their purchase of their own residential properties by offering reasonable prices. Furthermore, the act enables expatriates who are acknowledged by the government to be capable of of contributing to the financial prosperity of the city-state to acquire residential properties in Singapore.

Expatriates may buy non-restricted residential properties even without prior approval from the Singapore government. Below are specific examples of non-restricted residential properties:

- apartment units within a structure that is not higher than six floors – condo units in approved condo development sites under the Planning Act – a lease contract on a restricted property; the term must not go beyond seven years

Expatriates who want to own all units in an apartment or condominium in an accredited development site must have prior approval from Singapore’s Minister for Law.

Likewise, a foreign national without any prior official sanction from Singapore’s Minister of Law cannot acquire residential properties that are categorized as restricted.

Under the Residential Property Act of Singapore, the following are classified as restricted residential properties:

- a vacant residential land – town houses, detached or semi-linked houses, or terraced houses standing on residential lots – lands not approved for condominium development under the Planning Act

The foreigner who intends to acquire a restricted residential property must fill out a form and then send this, together with the requisite supporting documents, to the Singapore Land Authority. This government agency is responsible for receiving the requests of the expatriate regarding the proposed ownership of a restricted residential property. The agency will appraise and approve or disapprove the application, depending on the virtues of the expatriate’s qualifications.

Find out more about a premier housing loan advisory firm, providing housing loans with free mortgage broking.

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Maintaining a regular assessment of your family finances is essential to the family’s financial welfare. Here are some guidelines to control your household finances.

Credit Card Use

If you have a credit card, use it, but don’t forget to pay the entire sum, not the minimum amount, at the end of the month. Use your credit card wisely.

Rule of Thumb

If the total household expenses is higher than 33% of your household income, it’s time to cut down on expenses. Below are useful tips to cut down your household expenses.

1. Always clean your air-conditioners.

2. Wash your laundry on full load.

3. Put thimbles on your taps

Allocate Book Keeping Reponsibilities to Your Children

If you have kids, share them a simple task in book keeping, like data-entry. This will make them understand basic financial principles. Moreover, it will also give them a sense of responsibility and promotes good financial practice.

Keep a File of Your Financial Statements

List down your finances. Have a notebook or a ledger. If you have a computer, put everything into a spreadsheet. You don’t even have to pay cash for a spreadsheet.

Here are some tips in organizing your financial statements.

1. To save time from entering data, get soft copies of bills and statements, if possible.

2. Save your files and have back-up of them. You can use CD-R or thumb drive. Then keep them in a safe place.

Plan Your Finances

If you have a littlle source of income, and there is only one person working in your family, think of getting an insurance plan for the breadwinner. Financial worries are not something your family should cope with in the event the sole breadwinner is incapacitated.

Make It a Routine

The more you postpone, the more it piles up. Give at least half an hour each week to analyze your finances.

Find out more about a premier Housing Loan advisory firm, providing Housing Loans with free mortgage broking.

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In Singapore, housing loan packages have two categories: fixed rates or floating (variable) rates.

Singapore fixed rate packages are commonly tendered for up to 3 years, but there are some lenders that go up to 5 years fixed rates or even 10 years. In many Western countries, fixed rates can be made throughout the loan tenure.

On the other hand, floating rates are classified into published rates or board rates. Published rates are mainly rates that are advetised daily, case being the Singapore Interbank Offered Rate (SIBOR) or Singapore Swap Offer Rate (SOR), while board rates are determined by the individual bank or financial institution. Most lenders tie their board rates to certain financial bech marks such as the SIBOR but the precise elements are often vague and variations in board rates tend to be uncertain.

In general, there are no confinements on emigrants getting housing loans in Singapore but do pay attention of the following.

Loan to Value

The maximum loan to value (LTV) in Singapore is 90% of the purchase price or valuation, whichever is lower. Housing loan packages for 90% financing are limited as some lenders do not extend maximum LTV to emigrants. Loan approval for 90% funding is also tighter than for LTV 80% and below.

Proof of Income

To have approval for a housing loan your latest income tax assessment or a letter of appointment from your local employer is necessary. Some local lenders do not respect tax assessments from other countries.

Landed Property

The commendation from Singapore Land Authority is mandatory before emigrants can buy restricted properties such as vacant estate or landed properties such as bungalows, semi-detached, and terrace houses.

In-principle Approval

You may also take an in-principle approval before purchasing. Consider to hire a honored and professional housing loan consultant. This may help you spare time and money with your loan approval.

Learn more about a premier Housing Loan advisory firm, providing Housing Loans with free mortgage broking.

When it comes to housing loans, many people do not refinance. A fundamental number are oblivious they have the option of changing their loan to another financier; others are simply indifferent. They stick with their very first lender and the “reward” for such loyalty tends to be higher interest rates. Due to the order of magnitude of housing loans and the tenure that the mortgage is amortized over, the interest we are talking about here can easy stretch from 1000’s to 100,000’s of dollars. Take a look at the following elements to see whether it’s time for you to consider refinancing.

Current Mortgage Interest Rate

It is definitely a positive indication for you to research refinancing when your current interest rate is higher than available loan packages on the market. A first step to take is to go back to your existing bank or financial institution and ask them to revise your package, otherwise known as repricing. If your lender comes back with an offer, it will normally be better than your existing one. You can then compare this offer with offers from other lenders to see whether you should switch or stay put.

Lock-in and Clawback Periods

When you take up a housing loan, there may be a lock-in period where your mortgage lender will charge you a penalty fee, normally a percentage of your outstanding loan value, if you were to fully repay your mortgage. Almost all home loans also come with a clawback period where the lender will claim back “freebies”, such as legal expenses, that they “gave” you when you take up your housing loan (Note: lock-in period is separate from clawback period). It may not be valuable for you to refinance due to such costs.

Loan Quantum

The larger your mortgage amount, the greater your savings for the same decrease in interest rates. For example, 1% on a loan of S$100,000 is much less than 1% on a loan of S$500,000. However, fixed cost to refinancing, which comprises mainly of legal fees, do not vary much with loan quantum. The difference between your current and refinancing interest rates, therefore, has to be bigger for a relatively smaller loan as fixed cost eats into a more substantial portion of your interest rate savings.

Perceived Interest Rate Movements

Your view on how interest rates is moving can be a factor when considering whether you should refinance. If you are currently on a fixed rate package and believe interest rates are dropping, you may want to refinance to a floating rate package. Conversely, if you are on floating rates and believe interest rates are rocketing, converting to fixed rates may be a effective choice.

Personal Financial Appraisal

If there is a change in your financial state, you may want to vary your package particulars via refinancing. For example, you are beginning your own business and do not want volatility in other areas. Give some thought to taking up a fixed rate package. Maybe you want cash to invest in another place. Consider raising your loan quantum. Or your monthly income has increased and you want to minimise interest loan payments. Consider reducing your loan tenure.

Consider calling us today if you are looking for refinancing in Singapore. We can save you a lot of money plus give you the latest advice all for free.

Find out more about a premier Housing Loan advisory firm, providing Housing Loans with free mortgage broking.