Nexus Mortgage SG  ·  3 June 2026  ·  9-minute read

How to Apply for a Home Loan in Singapore (2026): Step-by-Step

By Dan Ler, Mortgage Advisor

1Work Out Your Real Budget

Before you fall in love with a property, work out the number a bank will actually lend you. Three rules set the ceiling.

• Under TDSR, your total monthly debt across all loans cannot exceed 55% of gross monthly income.
• For HDB flats and Executive Condominiums, MSR adds a second cap: the housing instalment alone cannot exceed 30% of gross income.
• The bank works out both ratios at a notional 4% p.a., not today's rate, so you qualify for less than the live rate suggests. See our MAS 4% stress test guide and TDSR & MSR explainer.

On top of the income test, the Loan-to-Value (LTV) limit caps the loan at 75% of price or valuation, whichever is lower, for a first housing loan. That has applied to both HDB and bank loans since 20 August 2024. The remaining 25% is your downpayment. Run your number on our affordability calculator before you start viewing.

2Get Pre-Approved First: HFE Letter or IPA

Secure your In-Principle Approval or HFE letter before you sign the Option to Purchase, never the other way round.

This is the step most first-time buyers get wrong. Always get pre-approved before you sign an Option to Purchase (OTP). Which pre-approval you need depends on your loan route.

HDB route: HFE letter

If you want an HDB concessionary loan, you first need an HDB Flat Eligibility (HFE) letter. One document confirms your eligibility to buy, your grant entitlement and your HDB loan eligibility. Processing takes about a month once HDB has your full set of documents. If you are also considering a bank loan, you can request an In-Principle Approval from participating banks at the same time. Apply early. You need the HFE letter before you can book a flat or get an Option to Purchase on a resale flat.

Bank route: In-Principle Approval (IPA)

For a bank loan, get an In-Principle Approval. It is the bank's commitment to lend up to a stated amount and tenure. A bank IPA can be issued within a few business days and is usually valid for 30 days, up to 90 with some lenders. It gives you a firm budget, so you bid or negotiate with confidence. Sign an OTP before you have an IPA and you risk forfeiting your option fee if the loan falls short. See our IPA & mortgage broker guide.

3HDB Loan or Bank Loan?

If you are buying an HDB flat, you choose between the HDB concessionary loan and a bank loan. EC and private buyers can only use a bank loan.

In 2026 a bank loan is usually cheaper, but the HDB loan needs no cash down and never springs a rate surprise on you. Weigh it up with our HDB vs bank loan guide and the first-time HDB buyer guide.

4Compare Packages Across Banks

If you go the bank route, the package matters more than the brand. The main choice is between two types.

• A fixed rate locks you in for 1–3 years. You get certainty for a slightly higher rate, fixed from around 1.4% p.a. in 2026.
• A SORA-pegged (floating) rate tracks 1M or 3M Compounded SORA plus a bank spread. It starts cheaper but moves with the cycle.

Look past the headline rate too. Compare the lock-in period, the legal and valuation subsidy, free conversion and any cashback. Rates change monthly, so check the latest mortgage rates before you choose, and remember the cheapest lender for a S$500K HDB loan is rarely the cheapest for a S$1.5M condo. See live numbers on our current rates page and read best home loan for condo & private property. This is exactly where comparing all 16 banks at once earns its keep.

5Documents Checklist

Have these ready before you apply. A complete file is the fastest path to approval.

Salaried applicants:

• NRIC (front and back)
• Latest 3 months' payslips
• Latest 12 months' CPF contribution history
• IRAS Notice of Assessment (1–2 years)
• Existing loan statements (car, other property, personal loans)
• The Option to Purchase if you are buying, or your current loan statement if you are refinancing

Self-employed or commission-based: add 2 years of IRAS Notices of Assessment. Your income is assessed after the MAS 30% haircut, and variable or bonus income is cut the same way. See our self-employed TDSR guide. I tell clients a clean, complete file is the single biggest factor in a fast, full-amount approval.

6Letter of Offer & Acceptance

Once you have a property and a chosen package, the bank issues a Letter of Offer (LO) setting out the loan amount, rate, tenure, lock-in and fees. Read it carefully. Check the spread after the teaser years, the lock-in, the prepayment penalty and any clawback of legal subsidy if you redeem early. Sign and return it within its validity, and pay any acceptance fee. For a refinance, the LO triggers your existing bank's redemption notice, usually three months.

7Legal, Valuation & Drawdown

A conveyancing lawyer handles the mortgage documents and liaises with CPF, IRAS and the bank. The bank orders a valuation, which can cap the loan if it comes in below price. You pay Buyer's Stamp Duty and the balance downpayment, the lawyer completes the purchase, and the bank disburses the loan. That happens in full for a completed property, or progressively for a new launch still under construction. For a new launch, financing follows the Progressive Payment Scheme.

Downpayment: Cash vs CPF

At 75% LTV the downpayment is 25% of price or valuation. How much of it must be cash depends on your loan.

• With a bank loan, at least 5% has to be in cash. The remaining 20% can be cash or CPF Ordinary Account.
• With an HDB loan, the full 25% can come from CPF OA. You only need cash if your CPF falls short.

Buyer's Stamp Duty is payable on top, in cash or CPF. Here is a worked example on a S$1,500,000 condo with a bank loan.

Pull your CPF Ordinary Account balance early. It decides how much cash you actually need on completion day.

How Long It Takes

• A bank IPA comes through in a few business days.
• An HFE letter takes about a month after HDB has your full documents.
• The Letter of Offer arrives within days of choosing a package.
• A resale completion usually runs 8–12 weeks from exercising the OTP.
• Refinancing takes around 3 months, set by the existing bank's redemption notice.

Start the pre-approval before you view seriously. Let the budget number lead, not the listing.

Five Mistakes to Avoid

1. Signing the OTP before you have pre-approval. This is the most expensive error, because you can forfeit the option fee if the loan falls short.
2. Budgeting at today's rate instead of 4%. The stress floor decides your maximum loan, so model that, not the teaser rate.
3. Forgetting Buyer's Stamp Duty and the 5% cash minimum. Both turn into nasty surprises on completion day if you have not planned for them.
4. Taking the first bank's offer. Packages vary by loan size and property type, and the spread between banks is real money.
5. Ignoring the rate after the lock-in ends. A low teaser that jumps after year 2 can cost more than a flatter package.

Frequently Asked Questions

Fix your budget under TDSR 55% (and MSR 30% for HDB/EC) at the MAS 4% floor, get pre-approved (HFE letter for HDB, or a bank IPA), compare packages across banks, submit your documents, accept the Letter of Offer, then complete legal and valuation to drawdown. A broker can run the whole comparison and paperwork free.

Yes — always. The IPA confirms how much a bank will lend so you don't over-commit. A bank IPA is usually valid 30 days (up to 90). Signing the OTP first and failing to get the loan can cost you the option fee.

NRIC, last 3 months' payslips, 12 months' CPF contribution history, and IRAS Notice of Assessment (1–2 years). Self-employed: 2 years of NOAs. Plus existing loan details and the Option to Purchase.

25% at 75% LTV. For a bank loan, at least 5% must be cash and the other 20% can be CPF. For an HDB loan, the full 25% can be CPF OA. Buyer's Stamp Duty is on top.

A bank IPA takes a few days; an HFE letter about a month. After choosing a property, the Letter of Offer follows in days and a resale completes in roughly 8–12 weeks.

The HDB loan is 2.6% p.a., stable and needs no cash down, but HDB-only. A bank loan is usually cheaper in 2026 (fixed from ~1.4% or SORA) and covers HDB/EC/private, but needs 5% cash and moves with rates. It depends on the property and your cash position.

About the author — Dan Ler has advised on Singapore home loans since 2017 at Nexus Mortgage SG, an independent brokerage comparing 16+ MAS-regulated lenders. Nexus has facilitated 500+ home loans across HDB, EC, private condo and landed property segments. Banks pay Nexus on disbursement, so there is no cost to the borrower.

Nexus Mortgage SG is an independent Singapore mortgage advisory. This article is general information, not financial advice. Home-loan eligibility, LTV, TDSR/MSR and CPF rules are governed by MAS, HDB and CPF policy; figures are illustrative and reflect positions as of 3 June 2026 and can change. Always confirm your specific eligibility with an independent mortgage advisor and your bank. Sources: MAS TDSR explainer, HDB HFE letter, CPF: using your CPF to buy a home.