House buying experience (I)

Because of business downturn, everything becomes cheaper.

If you want to buy HDB in Singapore, steps to go:

1) Find a agent

2) Look for house

3) Put deposit and make an offer to buy (owner will accept the deposit and sign Option To Purchase if he accepts)

4) Apply for bank loan or HDB loan

5) Within 14 days, must decide to exercise the option or not, if yes, then must get the loan approved and pay another $4K

6) Make first appointment with HDB, normally it is within 6~8 weeks

7) Go for first appointment

8) Pay remaining by cash or CPF

9) Final house inspection

10) Second appointment to complete, the whole process is 3 months normally

Of course, there is more detail for each step. I will explain later.

And for budgeting:

1) valuation + COV (cash over valuation) is the purchase price, COV must be paid by cash and can't apply for loan too. So it's better to buy in downturn, because normally owner can only ask for low or no COV, even the purchase price can be lower than valuation.

2) 5% downpayment must be paid by cash

3) Legal fee, few thousands, 2~3K

4) Agent service fee, 1% of purchase price + 7% GST

5) Other small fees, such as valution report, ...

So have to prepare cash at least: around 6.5% of purchase price + COV. Of course, if CPF isn't sufficient to cover upfront payment (bank loan is 80~90% at most), and if you want to do the renovation, more cash is needed.

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