Wow! it has been more than 1/2 month ago since i last posted anything here =P
Have recently received some letters from HDB with regards to our Park Central flat purchase
(1) On 9th Oct 2008, HDB informed us that our application for CPF Housing Grant hae been approved and a total of S$40,000.00 will be credited into our CPF accounts (S$20k each)
(2) On 10th Oct 2008, HDB sent us another letter. This is with regards to offering us a housing loan for the purchase of the flat. Guess what... It's an whopping loan of S$445,800.00, !! Geez... once we sign the loan agreement form, we will be $446k debt!! It will take us our lifetime (okay.. i'm exaggerating.. it's 30 years... but it feels like a lifetime lor...) to repay the loan.
After some calculation, i figured that we will be able to get back the initial 5% that we have paid in cash. But my colleagues have advised me to use that 5% to offset the HDB loan so as to reduce the total interest of the loan.
Should i do what they have advised? Or should i take that money and put it in fixed deposits (since MAS have just announced today that all deposits made to Singapore banks will be fully guranteed till end 2010)... Any advise anyone ??
Subscribe to:
Post Comments (Atom)
1 comment:
Hmm, a lot depends on what are your plans for the cash.
Personally, i don't think that taking the cash out and putting it into a FD is recommended. As interest rates from FDs are much lower than the housing loan's interest rate, you will be making a loss.
Hence unless you can find an instrument that can generate returns that are higher than 2.6%, it might be better to leave the cash in.
However, looking ahead, if you intend to take a renovation loan from the bank when you get the house then it might be better to set aside the cash for the renovation instead. More calculations are needed on this part :p
Post a Comment