A construction loan progressive payment finances new launch properties in Singapore through staged disbursements tied to building milestones, easing cash flow for buyers under the progressive payment scheme.
Homejourney simplifies this with multi-bank applications to DBS, OCBC, UOB, and more, plus Singpass auto-fill for faster approvals. This cluster dives into the process, benefits, and why applying via Homejourney ensures safety and trust in your BUC property loan.
What is Construction Loan Progressive Payment?
The progressive payment scheme structures payments for under-construction (BUC) properties like new launch condos, aligning them with construction stages from foundation to TOP.[1][2]
Buyers pay 5-25% at each milestone, with banks disbursing loan portions only upon verification. This applies to private condos and ECs, starting with 5% cash booking fee and 15-20% downpayment via cash or CPF.[1][5]
Monthly installments begin after the first loan disbursement, based on your loan-to-value (LTV) ratio—e.g., 75% LTV starts at foundation (5%), keeping early repayments low.[1]
Standard Progressive Payment Schedule in Singapore
Here's the typical breakdown for a new launch condo:
| Stage | Payment (% of Price) |
|---|---|
| Booking Fee | 5% Cash |
| S&P Agreement (within 8 weeks) | 15-20% Cash/CPF |
| Foundation | 5% Cash/CPF/Loan |
| Reinforced Concrete Framework | 10% Cash/CPF/Loan |
| Partition Walls | 5% Cash/CPF/Loan |
| Roofing | 5% Cash/CPF/Loan |
| Doors/Windows/Electrical/Plumbing | 5% Cash/CPF/Loan |
| Carpark/Drains/Roads | 5% Cash/CPF/Loan |
| TOP | 25% Cash/CPF/Loan |
| CSC | Balance (Legal Fees) |
Payments due within 14 days of developer notice; delays incur fees. Late buyers may pay multiple stages at once.[1]
Key Benefits of Progressive Payment Scheme
- Cash Flow Relief: Spread payments over 2-4 years, avoiding lump sums.[1][2][5]
- Low Initial Repayments: Interest-only starts post-first disbursement; e.g., $1.5M condo at 3% rate means ~$3,750/month initially.[2]
- Developer Accountability: Payments tied to progress protect buyers from delays.[1][3]
- Capital Appreciation: Buy early, gain value by TOP (e.g., recent ECs up 20-30%).[5]
For new launch financing, this beats resale where full payment is upfront.
How Construction Loans Work with Progressive Payments
Banks like DBS, OCBC, UOB assess via TDSR (60% debt cap) and MSR for HDB. LTV max 75% for first-timers (55% over 30 years age).[7]
Loan disbursed progressively to developer via lawyer. Use Homejourney's eligibility calculator at https://www.homejourney.sg/bank-rates#calculator to check borrowing power instantly.
Step-by-Step: Applying for Construction Loan via Homejourney
- Check Eligibility: Use Homejourney's tool for TDSR/MSR simulation.Construction Loan Progressive Payment Explained: Bank Rate Comparison Guide | Ho...
- Compare Rates: View DBS, OCBC, UOB, HSBC, etc., at https://www.homejourney.sg/bank-rates.
- Submit Multi-Bank App: One form via Singpass auto-fills income/CPF; sends to 10+ banks.
- Receive Offers: Track status, compare side-by-side on platform.
- Accept & Disburse: Bank funds stages; you pay installments.
Avoid pitfalls: Prepare docs early; factor BSD/ABSD (e.g., 17% ABSD for second property).[2]
Documentation Checklist for Approval
- NRIC/Passport
- Income proof (last 3 payslips, tax assessment)
- CPF statements
- S&P Agreement
- Option to Purchase
- Form A (HDB if applicable)
Upload via Homejourney for seamless multi-bank submission. Pro tip: Apply pre-S&P for best rates.
Benefits of Applying via Homejourney
Homejourney prioritizes your safety with verified bank partners and transparent tracking, skipping one-by-one apps.
- Multi-Bank Efficiency: One app to DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB—get best offers fast.
- Singpass Speed: Auto-fill cuts processing to days.
- Real-Time Tools: SORA trends, calculators for developer payment planning.
- Trust & Support: Mortgage brokers guide you; user feedback drives improvements.
Link to our pillar: Construction Loan Progressive Payment Explained: Singapore Guide Construction Loan Progressive Payment Explained: Singapore Guide | Homejourney for full overview.
Pro Tips for Singapore Buyers
- Time app post-launch for lower rates (SORA ~3% in 2026).
- Budget 25% downpayment cash/CPF for $1.5M unit (~$375K).
- Search BUC projects via https://www.homejourney.sg/search.
- Boost odds: Stable job, low debt.Construction Loan Progressive Payment Explained: Boost Approval Odds | Homejourn...
Disclaimer: Rates vary; consult Homejourney brokers. Not financial advice.
FAQ: Construction Loan Progressive Payment
What is a progressive payment scheme?
Staged payments for BUC properties tied to milestones, financed progressively via loans.[1][3]
When do installments start for construction loans Singapore?
After first disbursement (e.g., foundation for 75% LTV).[1][7]
Can I use CPF for progressive payments?
Yes, post-downpayment; full at TOP/CSC.[1][5]
How does Homejourney make new launch financing easier?
Multi-bank apps, Singpass, comparisons at https://www.homejourney.sg/bank-rates.
What if developer delays?
Payments adjust; no extra installments until milestone met.[1][2]
Ready for secure construction loan progressive payment? Start with Homejourney's bank rates comparison at https://www.homejourney.sg/bank-rates for trusted, hassle-free applications.
