Construction Loan Progressive Payment Explained: Bank Rate Comparison Guide | Homejourney
Construction loan progressive payments allow Singapore buyers of Buildings Under Construction (BUC) properties to pay in stages tied to construction milestones, typically starting with 5-20% upfront and spreading the rest over 3-4 years until TOP.
At Homejourney, we prioritize your safety and trust by verifying real-time bank rates and offering tools to compare construction loan Singapore options securely. This guide breaks down the progressive payment scheme, compares rates across top banks, and provides actionable steps for new launch financing.
What is Construction Loan Progressive Payment?
The progressive payment scheme (PPS) is standard for BUC properties and new launches in Singapore. Buyers pay instalments of 5-15% at milestones like foundation, framework, walls, roofing, and TOP, per Housing Developers Rules.[3]
Unlike resale properties requiring 25% downpayment upfront, PPS eases cash flow—monthly repayments often start interest-only during construction.[1][2] For a S$1.5M condo, expect S$75,000 (5% option) + S$225,000 (15% downpayment), then bank-financed stages.[1]
Homejourney's mortgage calculator at https://www.homejourney.sg/bank-rates#calculator lets you simulate your schedule instantly using Singpass for accurate inputs.
How Progressive Payments Work: Typical Schedule
Payments align with construction progress to protect buyers—developers can't claim funds without milestones.[2] Here's a standard breakdown for private condos:
- Option to Purchase: 5% cash/CPF (e.g., S$75,000 on S$1.5M property)
- Sale & Purchase Agreement: 15% total downpayment (cash/CPF/bank)
- Foundation (6-9 months): 10% bank loan
- Framework: 10-15% bank loan
- Walls/Partitions: 5-10% bank loan
- Roofing/Flooring: 5-10% bank loan
- Completion Works: 5-10% bank loan
- TOP (3-4 years): 25% bank loan
- CSC (12 months post-TOP): 15% balance
Interest is interest-only until TOP, then principal + interest. Use Homejourney's eligibility calculator to check LTV limits (80% for first-timers).[1][2]
Bank Rate Comparison for Construction Loans (Dec 2025)
BUC loans use floating rates like 3M SORA + spread (typically 0.5-1.5%), no fixed rates due to construction timelines.[2] Compare partners on Homejourney at https://www.homejourney.sg/bank-rates for live updates.
| Bank | Current Rate (3M SORA + Spread) | Lock-in | Best For |
|---|---|---|---|
| DBS | SORA + 0.80% (~3.20% eff.) | 2 years | First-timers, seamless app |
| OCBC | SORA + 0.75% (~3.15% eff.) | 2-3 years | Investors, quick approval |
| UOB | SORA + 0.85% (~3.25% eff.) | 2 years | HDB upgraders |
| HSBC | SORA + 0.70% (~3.10% eff.) | 1-2 years | Expats, competitive spreads |
| Standard Chartered | SORA + 0.90% (~3.30% eff.) | 2 years | High-value loans |
| Maybank | SORA + 0.65% (~3.05% eff.) | 3 years | Low rates, flexible |
Rates as of Dec 2025; SORA ~2.35%. Public Bank, CIMB, RHB, Hong Leong, Citibank offer similar (SORA +0.6-1.0%). Compare all instantly on Homejourney—let banks compete for your loan.[2]
The chart below shows recent interest rate trends in Singapore:
SORA has stabilized post-2024 peaks, favoring fixed spreads now. Track live on Homejourney for timing your BUC property loan.
Pros, Cons & Who Should Use PPS Loans
- Pros: Cash flow relief, interest-only early, capital gains pre-TOP (e.g., 10-20% appreciation).[2]
- Cons: Delay risks, rate hikes, must secure loan pre-OTP for CPF use.[2]
Ideal for new launch buyers at Projects . First-timers save on upfront cash vs. resale. Risks: Delays at sites like those in Punggol (common 3-6 month slips).
Insider tip: Apply early via Homejourney's multi-bank system—submit once, get offers from DBS/OCBC/UOB simultaneously using Singpass for 48-hour approvals.
Actionable Steps to Secure Your Construction Loan
- Check Eligibility: Use Homejourney calculator at https://www.homejourney.sg/bank-rates#calculator (TDSR & LTV compliant).
- Compare Rates: View all banks at https://www.homejourney.sg/bank-rates.
- Apply Multi-Bank: One form, Singpass auto-fill—banks bid for you.
- Documents: IC, income slips, OTP. Processing: 1-3 days.[2]
- Monitor Progress: Track via developer + Homejourney dashboard.
For boosting approval odds, see Construction Loan Progressive Payment Explained: Boost Approval Odds | Homejourn... . Always consult professionals; rates fluctuate.
Why Choose Homejourney for New Launch Financing
Homejourney verifies data for trust, offers real-time SORA tracking, and simplifies developer payment planning. Search BUC projects at https://www.homejourney.sg/search within your budget. Our WhatsApp support ensures safe transactions.
This cluster links to our pillar: Construction Loan Singapore Complete Guide for full coverage.
FAQ: Construction Loan Progressive Payment
What is the difference between PPS and resale financing?
PPS spreads payments over construction; resale needs 25% upfront + immediate repayments.[3]
Can I use CPF for progressive payments?
Yes, for initial 20%, but secure loan letter first for CPF Board approval.[2]
How do interest rates affect PPS loans?
Floating SORA-based; interest-only till TOP. Compare on Homejourney to lock best spreads.
What if construction delays?
Payments/interest pause until milestone; protects you per rules.[1]
Best bank for BUC loans?
Maybank/HSBC for low spreads; use Homejourney to compare all + apply simultaneously.
Ready for Construction Loan Progressive Payment Explained: Bank Rate Comparison Guide? Start at https://www.homejourney.sg/bank-rates—compare, calculate, apply safely with Homejourney.
