Driven Neutral Newbie September 25, 2008 Share September 25, 2008 (edited) My fren bought his EA for $306,000 with 30 years loan repayment of $248,000 with 2.6% interest. He is about to sell the house at $460,000. He was caught dumbfounded when HDB officer told him of this 78% rule. He suppose to pay 78% of the unconsumed interest of the outstanding loan. He thought he would have net near $200,000 gain.Now... its very very much lesser. Anyone can advise on this. Edited September 25, 2008 by Driven ↡ Advertisement Link to post Share on other sites More sharing options...
Chrispie 5th Gear September 25, 2008 Share September 25, 2008 recently my gf's cousin also.. sold her flat supposedly with a handsome profit but gotta pay like some 25% of what interest or principal thingy.. But if HDB officer say liao.. can argue meh"? Link to post Share on other sites More sharing options...
Driven Neutral Newbie September 25, 2008 Author Share September 25, 2008 (edited) 25% . Wa. very inconsistent leh. I better dig out my hdb loan agreement and screen. Best thing is the property duno about this or simply ignore to tell seller. If the agent keep customer in the dark , den its very unprofessional. Its a rule den should let the seller beware. KNN Edited September 25, 2008 by Driven Link to post Share on other sites More sharing options...
Chrispie 5th Gear September 25, 2008 Share September 25, 2008 our hdb is alwys changing their policies.. what pay back cpf lah, top up here, top up there... at the end of the day everyone is confused. Then what grant here and grant there.. i read aldy also blur. Like the famous wisdom : If you cannot convince, confuse. Link to post Share on other sites More sharing options...
Shull Turbocharged September 25, 2008 Share September 25, 2008 2.6% interest means what? simple interest or compound interest.. Link to post Share on other sites More sharing options...
Driven Neutral Newbie September 25, 2008 Author Share September 25, 2008 I think you work on compound . Link to post Share on other sites More sharing options...
Route88 2nd Gear September 25, 2008 Share September 25, 2008 Its called "acrued interest" Link to post Share on other sites More sharing options...
Driven Neutral Newbie September 25, 2008 Author Share September 25, 2008 so got such 78% rule Link to post Share on other sites More sharing options...
Route88 2nd Gear September 25, 2008 Share September 25, 2008 If the agent keep customer in the dark , den its very unprofessional. Its a rule den should let the seller beware. KNN Obviously the agent cap palang one...shud calculate for customer and not hide abt it. Link to post Share on other sites More sharing options...
Route88 2nd Gear September 25, 2008 Share September 25, 2008 The officer shud know better,and ur fren agent shud calculate for him/her and decide b4 selling. Link to post Share on other sites More sharing options...
Code01 Clutched September 25, 2008 Share September 25, 2008 (edited) My fren bought his EA for $306,000 with 30 years loan repayment of $248,000 with 2.6% interest.He is about to sell the house at $460,000. He was caught dumbfounded when HDB officer told him of this 78% rule. He suppose to pay 78% of the unconsumed interest of the outstanding loan. He thought he would have net near $200,000 gain.Now... its very very much lesser. Anyone can advise on this. Is it a miscommunication? should be accrued interest right. Ask ur friend go to his CPF account under Total Public Withdrawal statement there is a figure in bold. Thats the amt he has to put back into his cpf. Formula is as such Selling Price - Outstanding HDB loan - CPF return with accrued interest = Cash Proceed By the way his Selling price is 460000 minus (Purchase price) 306000 (not including interest on loan)= $154000 How to get net gain $200000? Edited September 25, 2008 by Code01 Link to post Share on other sites More sharing options...
Evoluzio Neutral Newbie September 25, 2008 Share September 25, 2008 HDB also have rule of 78? Link to post Share on other sites More sharing options...
Dumb 4th Gear September 25, 2008 Share September 25, 2008 My fren bought his EA for $306,000 with 30 years loan repayment of $248,000 with 2.6% interest.He is about to sell the house at $460,000. He was caught dumbfounded when HDB officer told him of this 78% rule. He suppose to pay 78% of the unconsumed interest of the outstanding loan. He thought he would have net near $200,000 gain.Now... its very very much lesser. Anyone can advise on this. You fren must be poor if not dumb in maths. He bought $306k and sold $460 how could he gain $200k? At best, he gains $154k without taking interest etc into account. First he needs to pay HDB the outstanding loan. Next he has to put back into his CPF all the amounts he has drawn from his CPF (1) to make the downpayment for the flat and (2) to pay the monthly principal and interest to reduce the HDB loan. In addition he has to put back into his CPF the accrued interest on (1) and (2). Why got such thing as rule of 78 on HDB loan. He confused with car loan? Link to post Share on other sites More sharing options...
Picopico Neutral Newbie September 25, 2008 Share September 25, 2008 My fren bought his EA for $306,000 with 30 years loan repayment of $248,000 with 2.6% interest.He is about to sell the house at $460,000. He was caught dumbfounded when HDB officer told him of this 78% rule. He suppose to pay 78% of the unconsumed interest of the outstanding loan. He thought he would have net near $200,000 gain.Now... its very very much lesser. Anyone can advise on this. Letz set aside whether your fren is dumb or not. My question is............. Is the property agent DUMB or something? He earn comm for what ah? Ash him/her if in doubt lah............................. or your fren dunnoe how to ask. Link to post Share on other sites More sharing options...
Dumb 4th Gear September 25, 2008 Share September 25, 2008 The property agent cant be dumb cause he able to make the seller pay commission without the seller asking or find out. May be seller got conned into selling. Link to post Share on other sites More sharing options...
Tjkbeluga 5th Gear September 25, 2008 Share September 25, 2008 My fren bought his EA for $306,000 with 30 years loan repayment of $248,000 with 2.6% interest.He is about to sell the house at $460,000. He was caught dumbfounded when HDB officer told him of this 78% rule. He suppose to pay 78% of the unconsumed interest of the outstanding loan. He thought he would have net near $200,000 gain.Now... its very very much lesser. Anyone can advise on this. No such thing as rule 78 laa... Since the interest rate is 2.6%, this must be the loan from HDB at consessionary rate. So, even less likely that to be inconsistent compare to the commercial bank loan. I could only think that it's accrued interest supposely earn from CPF if left untouched which must be returned to the CPF. So, the longer period and the bigger loan he took to pay to service the loan, the less cash in hand he will get. So, like one of the member mentioned, it will be 460,000 - whatever outstanding loan(pay up to settle the loan) - total CPF used - accrued CPF interest. He may not get a lot of cash in hand but his CPF will have substantial amount. Link to post Share on other sites More sharing options...
Tjkbeluga 5th Gear September 25, 2008 Share September 25, 2008 I think should not be confused with the 2.6% loan interest and the 2.5% interest which you will earn from CPF if it's left untouched. 2.6% load interest is what HDB will earn. This one is gone for good. Accrued interest is the interest which you would have earned if you left the CPF untouched. So when you sell your HDB, the accrued interest must be taken out from the sales earning and put back into your CPF. Link to post Share on other sites More sharing options...
Driven Neutral Newbie September 26, 2008 Author Share September 26, 2008 Think he round off the figure of the gain. Paiseh. His case is a divorce case. The confusing levy also kicks in plus some duno what rule on divorce case upon selling of matrimonial home. Thank you anyway. Good day ↡ Advertisement Link to post Share on other sites More sharing options...
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