Butoot

Hi I am currently the sole owner of a condo unit which is under mortgage. I had also taken an equity loan because of the increase in value of my house the last time I refinance it. I do not have any other property. I am planning to sell the unit to my partner as she wants to take over the whole unit. How best can we do it quickly and smoothly? We intend it to be an actual sale, ie she will need to use her CPF and probably take up a loan to buy it from me. It will not be merely a transfer of ownership. She does not own any other property. I would appreciate any kind advice here. Thanks very much!

Hi My parents are thinking of laying new electrical wires and switches in their 4-room HDB flat in Clementi. It was built in 1980. Would appreciate any reliable contact and an approximate of how much this would cost. The reason is that the wires are old and cannot handle much load. Whenever the air-con is switched on, a short circuit would occur. Thanks very much.

Hi Acetone is one of the most powerful solvents and I have been trying hard to get some. Could someone advise me where I could buy some? Thanks.

Hi Recently I used a new green wool and GIF detergent to clean the surface of my dining table which is white marble. I was horrified later to see many many fine scratches that now refuse to go away no matter what I do. Really heart pain to see the blur surface of my table everytime my family sit down to eat. Is there a solution for this, besides buying a new table? The table cost us more than a thousand 4 years ago. I have tried various marble polishers from DIY shops etc but to no avail. I am thinking of getting one of those grinding machines used by professional marble polishers who do marble floors. But I am lookinhg for a small portable one that I can use on my dining table and some spots of my marble floor. Is such a machine availabe in Singapore? Thanks a zillion for your kind advice!

Agree. But if you have ready cash or assets that can be liquidated quickly, there is nothing to be afraid of.

I don't think you can do much with $36,000. Probably neater to use refinance your property and wait perhaps for the value to rise. :-)

If you refinance and take an equity loan from your current bank, they shouldn't charge legal fees (but they will charge an Admin fee which is $500). In fact, they call it a conversion and it would be even faster than if you were to find a new bank. If it is a new bank, it would subsidize part of your legal fees. I think it is best you consult a Mortgage Broker who is in a much better position to advise you on this. Better still, consult two Mortgage Brokers. I did. Both were extremely helpful. In the end, I went with one because she was able to get a bank that gave me a much higher valuation for my house. If you want, I could pass you their contact numbers. There's no obligation as far as they are concerned. PM me if you need.

Hi Newie-X I have just refinanced my property and gotten an equity loan. I shall try to answer some of your questions based on my recent personal experience. I hope my answers could be helpful to you. 1. Is equity loan a new loan on top of my mortgage loan, or is it a replacement loan for my mortgage loan? Yes, the equity loan is a new loan. You get two loans with the same interest rate. You can use your CPF to pay off the monthly housing loan but you have to use cash to pay off the monthly equity loan installment. 2. What criteria does the bank look at in granting the equity loan to me? Because I already have a mortgage loan outstanding. The most important criterion is the value of your house. Has your house increased in value? The equity loan is given based on the increased value of your house. I have illustrated the formula for the loan in an earlier post in this thread. Different banks will offer different LTV. 3. Are there still SOR-rate equity loan? This I am not sure. It depends on the bank. 4. Can I ask for the same rates of my mortgage loan from my mortgage loan bank? I am sure you can ask. The rates are very competitve now. 5. Should I source for other banks' equity loans other than my present mortgage loan bank? Of course! In fact, the best thing you can do is to engage the service of a Mortgage Broker (MB). That saves you a lot of time calling up banks and checking on their various loan packages. The MB is in a position to compare all the loan packages and advise you on which is the best for you. You don't need to pay the MB a single cent. He/she gets the commission from the bank depending on the size of your loan. I used an MB for my loan and she was most helpful and very professional. If you are interested, I can pass you her contact number. 6. Is the period of the loan similar to property loans, ie 20-year or 30-year loan? Is there a lock-in period? I believe they have a formula for the tenure for the property loan which is 75 years minus your age. Usually there is a lock-in period of either one or two years, depending on the loan package. 7. Does it carry redemption penalties if the equity loan is redeemed within the lock-in period? Yes, definitely. It is a certain percentage of the loan amount. 8. If the equity loan is approved, I can start to use it within 6 mths and interest will start when I start to use it? And if I did not use the loan after 6 mths, the loan will lapse and I will not be charged any interest? I believe so but I cannot answer this question because I wanted the equity loan as early as possible. I got mine in two months after signing the letter of offer from the bank. Thanks in advance! You are most welcome! :-) The equity loan will come in useful when investment opportunities arise. But you are not allowed to buy another property using it. It is a guideline issued by MAS. The bank will probably ask you for a statement on what you intend to do with the equity loan. If you say you want to buy another property, it won't grant the loan. Just say that it is for investment or other purposes, eg stocks and shares, paying off other higher interest loans like car loans, children education etc.

I asled if the bank or applicant can back out after the applicant has signed the Letter of Offer for any housing loan. I have since found the answer. There is a penalty clause. Thanks.

Hi Pufferfish Thanks for your reply. I learnt it from two different mortgage brokers who should know what they are talking about. I also read from Dennis Ng's website and he mentioned the same thing. As long as you have one or more outstanding loan, you only get 60%. If you have totally no housing loan, then it is 80%. Please see this: http://www.masteryourfinance.com/forum/phpBB2/viewtopic.php?t=2093

Dear Kalimantan I am actually also quite new to this but let me try to give a very simple example using, as you suggested, a $1M property. Here goes: Your current property is valued at $1 million. So 60% is $600,000 Let's say you still owe the bank $200,000 and you have used up $300,000 of your CPF plus accrued interest. With the new policy now, if you want to get a Term Loan, the bank will give you only $600,000 minus $200,000 you still owe and minus the $300,000. You get to borrow only $100,000. Under the old policy where the bank could lend up to 80% LTV, you will be able to borrow $800,000 minus $200,000 minus $300,000 which is $300,000. A difference of $200,000!!! We can do a lot of things with $200,000!

What I heard is true. It is now official. From 27 July 11, banks will only grant you a 60% LTV if you want to get a term or equity loan (also known as cash out). This 20% makes a big difference to the final amount you can get after deducting the existing loan balance and the cpf plus accrued interest used in purchasing your property.

Hi I was told by the bank that it would be sending someone to my condo to appraise its value. How should I prepare for this? Thanks.

I think the government is tightening the property market basically by making it more difficult for people to freely take loans to buy more properties. I was told by a friend who works in the bank that the MAS does not allow the use of equity loans to buy property now. You are lucky. I heard that MAS has issued an instruction to the banks that all equity loans are limited to only 60% of the valuation of the property. I wonder what other measures will be imposed to dampen the property market!

Hi Is it true that an Equity Loan cannot be used to buy a property? I learnt from my colleague that this is a ruling from the Monetary Authority of Singapore. Is this something new or it has been so for a long time? I have heard of people who used their Equity Loan to invest in properties and land. Thanks.