How To Shorten Hdb Loan, Wat The Procedure ?

[LadyLuck 0]

any experience soul?

[alberttcs 0]

i went to hdb hub to enquire on this few days ago. You can just go to hdb hub to do partial redemption. no penalty involve, etc.

[bernice 0]

try not to shorten, as once u shorten u are unable to extend anymore.

jus make lump sum payment once ur CPF have like 10k, HDB will revised ur outstanding amt again. hope it helps.

[redbottle 0]

hi,

if u have spare cash, invest it rather than prepay ur hdb loan.

that's because hdb loan has v v low interest rate (0.1% + CPFOA rate of 2.5% = 2.6%). if ur hdb loan still has more than 10 years to go, most investment over such long period can v probably earn u an interest rate higher than 2.6%.

for example, let's consider two scenarios:

(1) u have $10k spare cash and u use it to prepay hdb loan which still has 13 years more to go; u'll save a total of $4016.28 in the interest u pay.

(2) u invest the $10k in Singapore Govt Securities maturing in 13 years' time and u get a GUARANTEED return of 2.97% (http://www.fundsupermart.com/main/sgs/SGShome.tpl) (the guarantee is by the Singapore Govt no less), and continue to pay interests to hdb as normal. u'll receive a total return of $4670.61 from the SGS, and thus after deducting the interest paid to hdb, u pocket the difference, and so, u're $654.33 richer!

if u're more risk-tolerant, u can invest in shares, which can potentially gain u much more than 2.97%, and u'll be richer by an even greater amount.

if u have a financial planner, talk to him or her for advice.

[therat 18]

IMO,

For cash, use that for investment, the return will be better than the CPF 2.5% interest

For $$ in CPF, I will do repayment.

[alberttcs 0]

here's the link to do your partial redemption if you're keen.

http://www.hdb.gov.sg/fi10/fi10201p.nsf/WP...an?OpenDocument