Should I take an HDB loan or a bank loan?
It depends on your priorities. An HDB loan and a first bank loan both cap borrowing at 75% loan-to-value since 20 August 2024, but an HDB loan needs no cash for the downpayment while a bank loan requires at least 5% in cash. For HDB flats, the 30% Mortgage Servicing Ratio usually binds. Compare your cash position and monthly repayment comfort before deciding.
The full rules
HDB loan vs bank loan — the rules
| Feature | HDB loan | Bank loan (first) |
| Max loan-to-value (LTV) | 75% | 75% |
| Minimum cash downpayment | Not specified in data | 5% |
| Mortgage Servicing Ratio (MSR) | 30% (HDB flats & ECs) | 30% (HDB flats & ECs) |
| Total Debt Servicing Ratio (TDSR) | Applies (all FI loans) | 55% |
Key points
- The HDB-granted loan LTV was cut from 80% to 75% on 20 August 2024, aligning it with bank loans.
- The MSR caps home-loan repayments at 30% of gross monthly income and applies to HDB flats and Executive Condominiums only. It applies together with TDSR and is usually the binding constraint.
- The TDSR caps total debt repayments at 55% of gross monthly income and applies to all property loans from financial institutions.
- Second bank loan LTV is 45%; third or subsequent is 35% (based on 30-year tenure and age ≤65 at maturity assumptions).
*Data verified as of 5 September 2026.*
Worked example
Worked example
Suppose you are buying an HDB flat priced at $500,000.
| Item | HDB loan | Bank loan (first) |
| Purchase price | $500,000 | $500,000 |
| Max LTV (75%) | $375,000 | $375,000 |
| Balance to fund | $125,000 | $125,000 |
| Minimum cash required | Not specified in data | 5% = $25,000 |
With either option you can borrow up to $375,000 (75%). For a bank loan you must pay at least $25,000 in cash (5% of price). The remaining balance can be met with CPF and cash.
Because this is an HDB flat, the 30% MSR applies to both options. If your gross monthly income is $6,000, your maximum monthly home-loan repayment is capped at $1,800 (30% of $6,000), and total debt must stay within 55% TDSR ($3,300).
What this means for you
If you have limited cash on hand
An HDB loan requires no minimum cash downpayment stated in the data, whereas a first bank loan requires at least 5% in cash. If cash is tight, the HDB loan may be easier to fund.
If you are buying an HDB flat or EC
Both loan types face the 30% MSR, which is usually the binding constraint. Check that your repayment stays within 30% of gross monthly income under either option.
If you already hold property loans
A second bank loan is capped at 45% LTV and a third or more at 35% (30-year tenure, age ≤65 at maturity assumptions). This affects how much cash you must find on top.
Related questions
How much can I borrow with an HDB loan?
Up to 75% loan-to-value. This was cut from 80% to 75% on 20 August 2024, aligning HDB loans with bank loans.
Do bank loans require a cash downpayment?
Yes. A first bank loan requires at least 5% of the purchase price in cash. The data does not state a cash minimum for HDB loans.
What is the MSR and does it affect both loan types?
The Mortgage Servicing Ratio caps home-loan repayments at 30% of gross monthly income. It applies to HDB flats and ECs, and is usually the binding constraint for both loan types.
What is the TDSR limit?
The Total Debt Servicing Ratio caps total debt repayments at 55% of gross monthly income. It applies to all property loans from financial institutions and works together with the MSR.
What LTV applies to a second bank loan?
A second bank loan is capped at 45% LTV, and a third or subsequent loan at 35%, based on a 30-year tenure and age ≤65 at maturity assumptions.
More answers: Can I buy an EC while owning an HDB flat? · Who can buy an Executive Condominium? · What salary do I need to buy a 1 million dollar condo? · What salary do I need to buy a 1.5 million dollar condo?
Sources: HDB / MAS — loan-to-value limits · MAS — Mortgage Servicing Ratio · MAS — Total Debt Servicing Ratio · Last verified 2026-09-05