Loan, Valuation And Down Payment

[MataHari 1]

Hi I'm planning to buy resale flat. I have a burning question on OTP 5K that we are going to pay to the seller. My example is like this, we buy the house at valuation and we only take bank loan of 80%. So what will happen with the $5K OTP and exercise OTP fee? Will it be accounted as my 5% cash down payment? And this down payment will be paid to...?? HDB, BANK??

I'm so confused. I hope there's a kind soul to give immediate answer. We are just started to try negotiating. Seems this unit is closing very fast. Sigh.. frenzy resale market... What we really hope is to minimize cash involved as they normally ask for above valuation. Haiz....

[raincole 0]

If flat is sold at valuation, and the amt given to seller is $5k, on the 1st appointment date, for the 10% deposit, this 5K will be deducted. And if you wanted to loan a lesser amount, you can use CPF to pay for flat.

Ultimately, the 5k will be recorded as payment to flat, balance you need to come up either from CPF or cash (10%) and further if you wanted to loan lesser.

[MataHari 1]

If flat is sold at valuation, and the amt given to seller is $5k, on the 1st appointment date, for the 10% deposit, this 5K will be deducted. And if you wanted to loan a lesser amount, you can use CPF to pay for flat.

Ultimately, the 5k will be recorded as payment to flat, balance you need to come up either from CPF or cash (10%) and further if you wanted to loan lesser.

Thanks much clearer now. Another burning question, the 10% downpayment is paid to HDB but $5K OTP is paid to the seller. How do they settle this??

Seems like by default we are paying OTP for cash above valuation? Confuse..confuse....

[raincole 0]

The 5K OTP can be considered as part of the 10% downpayment, you pay (10% downpayment - 5K) at the 1st appointment date then.

And if it is above valuation, these are considered as cash above valuation, then for the remaining cash above val is also paid at the 1st appointment date.