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Home Loan Repayments stretch years

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#1

Posted 20 July 2012 - 11:33 PM

Civic2000
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UNITED Overseas Bank (UOB) has introduced a home loan that spans half a century - likely the longest-term loan available here.

UOB introduced this longer loan duration as more customers have been requesting for such loans.

However, these loans come with conditions. 'This type of loan is applicable to private residential and HDB loans only,' said Ms Chia Siew Cheng, UOB's head of secured loans and personal financial services. As well, borrowers above a certain age are not eligible, but UOB declined to say what the cut-off age is.

And if the property is leasehold, it needs to have at least 35 years left on the lease at the end of the 50-year loan.

Ms Chia noted that the loan has its pros and cons. Having a longer term 'will result in a smaller monthly loan instalment and will be easier on monthly cashflows. However a longer repayment period also means that more interest will be payable'.

Financial adviser Damian Pang warned that by taking on such a long-term loan, the homeowner will be servicing the loan long into his retirement years.

A quick check with other banks here found that the longest loan term was 40 years.

At OCBC, for example, the maximum loan period for private and HDB homes is 40 years, or up to the age of 75 years, whichever is earlier.

At HSBC, customers with at least $200,000 with the bank can get loans of up to 40 years. Others can receive loans of up to 35 years, at the most.

Even then, most customers opt for loans of just 30 years, said Mr Harmander Mahal, HSBC Singapore's head of customer value management. Only about 1 per cent of customers take up the 40-year loans.

Longer-term loans require the borrower to pay a smaller sum each month. This gives consumers the confidence to purchase new homes, and could help to keep prices buoyant, said Mr Ku Swee Yong, the chief executive of International Property Advisor. 'It improves affordability, which means it is good for the housing market in general, not just developers.'

Homeowner Edward Ti, 28, said he would certainly take up a 50-year loan for an investment property. 'I would take a 50-year loan if interest rates are low. I would think that it is more efficient to use the money saved from the monthly mortgages to do something else.'

If a borrower takes out a 50-year loan for $1 million at an interest rate of 1.7 per cent, he would have to pay about $2,475 monthly for his mortgage, compared with $3,548 if the loan ran for 30 years.

This is assuming a period of low interest rates. However, if interest rates rose, say to 3 per cent, the $1 million 50-year loan would mean monthly repayments of $3,220.


yasminey.com.sg

Paving the way for obscenely overpriced HDB flats. Be prepared to pay 1 million for a 4/5 Room HDB flat soon. So it's total slavery to your flat and many have to work till their last day with no retirement.


When I shut my mouth and turn and walk away, it doesn’t mean you’ve won. It simply means that you are not worth any more of my time.

#2

Posted 20 July 2012 - 11:37 PM

Latka
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just another way of enslaving the masses.
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#3

Posted 20 July 2012 - 11:47 PM

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For the roof over one's family (i.e., not investment properties), your living space, my guidance would be to OWN the place by the time you reach 50, or earlier.

Definition of 'place': can be a GCB, bungalow, semi-D, terrace, strata-title town house, condo, or HDB ... it does not matter
Definition of 'own': all loan(s) fully paid up and you must hold the title (or strata title) deed.

BEFORE YOU TURN 50 YEARS OLD!

To be on a loan approaching, or worst, past, retirement is plain stupidity IMHO!
aka Jolie888

#4

Posted 21 July 2012 - 12:02 AM

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So, we are picking up Japanese model?... soon, my grandson will continue my son's monthly repayment..

#5

Posted 21 July 2012 - 12:05 AM

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All because of GREED.

#6

Posted 21 July 2012 - 12:25 AM

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Siow!! Take 50 years loan for a bl**dy roof? hur.gif I rather buy something more affordable and enjoy more things in life with my family unimpressed.gif

Next is 20 year loan for car? COE expired but still continue serving one's 5 series?

Edited by Poper, 21 July 2012 - 12:26 AM.


#7

Posted 21 July 2012 - 12:34 AM

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If you can't repay your housing loan in 30 years, it's maybe time to look into quitting this country. That's the take home (no pun intended) message.

Offering this 50 year loan sets a very dangerous precedent. It's a slippery slope to generational debt.

Edited by Turboflat4, 21 July 2012 - 12:35 AM.

Praise be unto He.

#8

Posted 21 July 2012 - 12:42 AM

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Easy loans and credits is what brought us here today: sky-high transport and living costs.

#9

Posted 21 July 2012 - 12:59 AM

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Easy loans and credits is what brought us here today: sky-high transport and living costs.


sadly, credit is wat makes the world go round.
But where transport is concerned, perhaps gahmen shud re-introduce the 30% downpayment policy.
Whatever Does Not Destroy Me, Strengthens Me.

Give Up On Life But Never Give Up On Yourself

#10

Posted 21 July 2012 - 01:05 AM

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sadly, credit is wat makes the world go round.
But where transport is concerned, perhaps gahmen shud re-introduce the 30% downpayment policy.


I remember zero downpayment policy was implemented when pinky was the finance minister... maybe back then he already thinking of how to boost GDP number liao..

#11

Posted 21 July 2012 - 01:16 AM

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I remember zero downpayment policy was implemented when pinky was the finance minister... maybe back then he already thinking of how to boost GDP number liao..


Exactly, all dey want is to falsely boost GDP nbrs abd pay themselves unjustified salaries.
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Give Up On Life But Never Give Up On Yourself

#12

Posted 21 July 2012 - 06:42 AM

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Look what happen to car prices and COE when zero downpayment and ten years loan was implemented.
The same scenario will play out if most took up the 40-50years bank loan for housing!

A 25years old person can now loan 50yrs till 75yrs old.
The assumption is that perhaps within 5 years after buying the prop, the value will appreciate to exceed the loan? Then the remaining 45years is just a matter of feel good feelings. All is well if such situation.

I just hope old man and LHL can live another 50years to maintain the stability, that had allowed the props to grow so well for the past 47years.
If the props never appreciate upwards enough to exceed the loan redeem value, then a cycle of doom may make these people to stuck for 50years. Slave and stuck and stupid.
Ironically there was a Slavery aAwareness photo booths outside Mandarine Hotel last week, along orchard road.
I think 50years loan is a new form of slavery in disguise!

I am just so happy I will be clearing my HDB loan in another 8 years time.
Can't imaging those on 40-50years loan. Everyday wake up, don't know truely can enjoy living or dread going to work to sustain the loans.

Edited by Liping24cn, 21 July 2012 - 06:47 AM.


#13

Posted 21 July 2012 - 06:45 AM

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I remember zero downpayment policy was implemented when pinky was the finance minister... maybe back then he already thinking of how to boost GDP number liao..


Increase GDP base on consumer spending?? That's very bad, as where do consumer spending get the $ from?? laugh.gif laugh.gif

To have sound economy is to have savings and production and not too much consumer spending which adds up trade deficit only. Sigh...

Edited by Yewheng, 21 July 2012 - 06:50 AM.


#14

Posted 21 July 2012 - 07:00 AM

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Exactly, need to Pass loans instead of paid up assets to the next generation. Such is the sad state. Heng im paying up mine in 2 years time laugh.gif

#15

Posted 21 July 2012 - 07:34 AM

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The thought that home prices can only go up is the main cause of the US housing bubble.

#16

Posted 21 July 2012 - 07:43 AM

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The thought that home prices can only go up is the main cause of the US housing bubble.


Ya, lucky MBT is not MND anymore. laugh.gif laugh.gif

Remember even during election period he still keep emphasising, don't you people want to see housing prices keep appericiating?? I mean keep appericate to what level??? Keep going up to skyrooft and cause bubble to burst?? What a thinking MBT during that time. Totally knife.gif knife.gif .

Actually price come down is a good sign not price goes up. laugh.gif laugh.gif ( This also applies to property prices )

The current housing prices which KBW say is under control, price is stable, which I feel is still not enough, as stable prices means what? Continue to rise at slow steady pace?? That's not right, as in the end price still goes up and sooner or later will still hit the bubble, just that the time taken is much longer. So to prevent that is to let price goes down. Deflation is actually good.

Edited by Yewheng, 21 July 2012 - 07:51 AM.


#17

Posted 21 July 2012 - 07:52 AM

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Only about 1 per cent of customers take up the 40-year loans.

Aiya its only an act to boost its being the first to roll out such package...dun really expect more than 1 % of take up rate. May be they can also roll out 20 years car loan biggrin.gif

#18

Posted 21 July 2012 - 09:01 AM

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grandpa pay 30 years
father pay 30 years
you pay 30 years

90 years loan is the best !!!
everyone can take smelly smelly $2,000,000 loan spread to 3 generations .... huat ah !

Edited by Wt_know, 21 July 2012 - 09:04 AM.


#19

Posted 21 July 2012 - 09:05 AM

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if take this loan, better make sure 50% downpayment

#20

Posted 21 July 2012 - 09:14 AM

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they should only allow for landed...cos landed survive few gens.


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