Contributed by Anders Ong
MOST people know we can get a loan from the bank to finance the property with a 90% margin or up to 100% for government staff or in some schemes for first-time homebuyers.
How do we get the loan or cash for the 10% downpayment if we are only eligible for a 90% loan? These are some ways for one to get the 10% downpayment:-
Credit Card – Good for making a booking but it comes with a high-interest rate, and one has to settle the bill within next month unless one is using the Easy Payment Plan (EPP) with an instalment of up to 36 months.
Personal Loan – Need to have a good monthly income to get a high personal loan
amount. However, it has a high-interest rate and will affect the CCRIS rating. One could take a personal loan to pay for the property booking, but it is like using debt to create more even more debts.
Employee Provident Fund (EPF) – Can apply to cash out from the Account 2 to pay the downpayment. The catch is one has to pay the downpayment first and receive the bank in from the EPF later.
Friends – If we have rich friends who don’t mind lending us a few bucks, this is one of the possible ways to get the money. However, it is hard to find friends who are willing to lend a huge amount of money, and if one fails to repay the money, the friendship is set to fail.
Father and Mother – Parents are one of the easiest ways to get the money or cash to purchase a property. Do remember that not every parent could afford to help their kids all the time and be kind to our parents.
Siblings – If one fails to get cash from our parents, one could borrow from one’s brother or sister. It is also possible to do a joint purchase with the siblings for property investment.
Selling of Property – If the parents have left you an old property, maybe it is time to sell it off. If one has a property that has appreciated in value, one could sell it off to raise more cash as well.
Refinance – When the existing property value appreciates, and the loan had been partially paid, one can refinance the property to get the capital from the bank to invest in more properties.
About the Contributor
Anders Ong is a young property investor who writes about real estate.
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