What is the payment timeline when buying new condos?

 

Want to buy a new condo but unsure about the payment process? Fret not…HomeReward has done up a clear time line for you so you can get your finances in order.

The following chart shows the time line after you have decided and put down a deposit for your new home:

New Homes Payment Timeline

 

What is an Option to Purchase (OTP)?

The OTP is a right given by a property seller (individual or developer) to a prospective buyer to purchase his property. It is a valid and binding real estate contract.

 

What is the Sale and Purchase Agreement?

This contract will contain details about the property being sold, such as price, size, address, items being offered by the developer as well as Information about the mortgage used by the purchaser.

 

What is Stamp Duty?

This is a tax imposed by the IRAS (Inland Revenue Authority of Singapore) for the purchase of property. The Buyer’s Stamp Duty (BSD) is typically calculated using the formula:

 

  • For properties $1mil and below: 3% - $5,400
  • For properties above $1mil: 4% - $15,400

 

There is also Additional Buyer’s Stamp Duty (ABSD) for purchasers of multiple properties or non-Singaporean purchasers. To check if you are liable for ABSD, cllck HERE for our HomeReward calculator.

 

What is an Approval-in-Principle(AIP)?

When you apply for a mortgage loan, the bankers will assess your eligibility and loan amount based on the Total Debt Servicing Ratio (TDSR). Once that is ascertained, they will offer you an AIP so that you are certain of how much you can loan. This is not a formal loan application. Only when you have decided on a unit, the bank will formally give you a Letter of Offer for the specific unit you have chosen to formalize the application and approval.

 

Why is there a 25% forfeiture of my deposit?

If you have put down a booking fee for a developer unit and subsequently are unable to exercise the option, or have changed your mind, a penalty of 25% of the fee is imposed by the developer.

 

How much are the conveyancing fee charged by the lawyer?

This ranges between $2000 - $3000. There will be a mortgage stamp duty usually at $500 if you are taking a loan. There are also additional charges if you are using CPF.

 

What if my 15% downpayment is late?

The developer will charge an interest on the outstanding payment on a per-day basis. If you have just sold a property, be sure to time your CPF return from the sale proceeds carefully. Consult our HomeReward partner agents if you are unsure.

 

What is the Progressive Payment all about?

Buildings Under Construction (BUC) will require payment by stages according to the progress of the construction. When purchasing a BUC, do check with the sales team at what stage the construction is in order to find out how much monthly installments u are required to pay. Below is a chart for your estimated payment in percentage.

 

Progressive payment for remaining 80%

Estimated Time Frame Stages Percentage drawdown of purchase price
6 – 9 months Completion of Foundation Work 10%
     
6 – 9 months Completion of Reinforces Concrete Framework 10%
     
3 – 6 months Completion of brick walls 5%
     
3 – 6 months  Completion of roofing / ceilings 5%
     
3 – 6 months  Completion of electrical wiring, internal plastering, plumbing & installation of door & window frames  5%
     
3 – 6 months Completion of carparks, roads, & drains serving the development 5%
     
   Notice of Vacant Possession 
(Temporary Occupation of Permit - TOP)
25%
     
  Legal Completion date (Certification of Statutory Completion - CSC) 15%

 

Disclaimer : This article serves as a guide only, and you should not make your decision based solely on this article. You are advised to seek professional advice from a licensed real estate salesperson to assist you in planning your real estate portfolio.