Housing loan packages in Singapore can be broadly defined into two categories: Fixed rates or Floating (variable) rates.
Fixed rates packages in Singapore are normally offered for up to 3 years. There are a few lenders that extend up to 5 years fixed rates or even 10 years. This is, however, quite different from many Western countries where rates can be fixed throughout the loan tenure.
Floating rates in Singapore can also be classified into published rates or board rates. Published rates are basically rates that are published daily, example being the Singapore Interbank Offered Rate (SIBOR) or Singapore Swap Offer Rate (SOR), whereas board rates are determined by the individual bank or financial institution. Most lenders peg their board rates to certain financial benchmarks such as the SIBOR but the exact constituents are often unclear and variations in board rates tend to be opaque.
Generally, there are no restrictions on expatriates taking up housing loans in Singapore but do take note 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 offer maximum LTV to expatriates. Loan approval for 90% financing is also stricter than for LTV 80% and below.
Income Proof
Your latest income tax assessment or a letter of appointment from your local employer is required to get approval for a housing loan application. Do note that tax assessments from some countries may not be accepted by the local mortgage lenders. For a complete list of documents required for a housing loan application, please refer to http://www.myhousingloan.com.sg/housing-loan-basic-info.php.
Landed Property
Expatriates need to take note that approval from Singapore Land Authority is required before they can purchase restricted properties such as vacant land or landed properties such as bungalows, semi-detached and terrace houses.
