Buying a home is probably one of the biggest purchases and decision of your life. There are a thousand and one things that you would need to consider. We hope to make your life a little bit simpler by providing you with a step-by-step guide for your new home purchase and securing your mortgage loan.
Progressive Payment Schedule for Building under Construction (BUC) properties Why do people want to buy properties still under construction? After all, there are more risks involved in purchasing an uncompleted house versus a completed one. Who knows? The developer may go bust before the property sees the light of day.
Well, the “early bird catches the worm” mentality is at play here. Some buyers want to grab the best units: units with the most beautiful views, etc. But more often than not buyers are motivated by the monetary savings that comes with early purchases. Developers dangle early-bird perks such as a per-square-foot discounts, or the absorption of stamp duties or other administrative costs.
For whatever reasons you are buying a BUC house, you will likely finance it with a loan. This article provides some useful information about BUC loans.
Progressive Payment Schedule for Building under Construction (BUC) properties Before the loan commencement, you will be required to stump up 5-25% [depends on the loan-to-value (LTV) limit and if there is any outstanding mortgage] of the transacted price in cash. The remaining difference between the loan amount and purchase price can be paid for with cash and/or CPF fund. As for the buyer’s stamp duty and additional buyer’s stamp duty (ABSD), they can be paid for with cash and/or CPF fund as well. The below table outlines the payment at the different stages. This payment schedule also applies to completed new private properties. Here, we assume it is the first property purchase. In addition, do note that for permanent residents (PRs) and foreigners & non-individuals, ABSD is payable.
Stage Payment under a standard payment scheme ( % of Purchased price)
Upon the grant of Option to Purchase 5% – 10% (booking fee)
Upon signing of the Sale & Purchase 20% less booking fee
Agreement or within 8 weeks from the Option date Completion of foundation work 10%
Completion of reinforced concrete framework of unit 10%
Completion of partition walls of unit 5%
Completion of roofing/ceiling of unit 5%
Completion of door sub-frames/ door frames, window frames, electrical wiring, internal plastering and plumbing of unit 5%
Completion of car park, roads and drains serving 5%
Temporary Occupation Permit or Certificate of Statutory Completion 25%
On completion date 15%
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