First Time Home Buyer Singapore: Complete Mortgage Guide 2026

Executive Summary

Buying your first home in Singapore is one of the most significant financial decisions you'll make. This comprehensive guide covers everything first-time home buyers need to know about mortgages in 2026—from understanding loan types and calculating affordability to navigating eligibility requirements and comparing rates across Singapore's major banks.

At Homejourney, we believe that informed buyers make confident decisions. This guide prioritizes transparency, accuracy, and practical advice to help you secure the right mortgage for your situation. Whether you're considering an HDB flat, executive condo, or private property, we've designed this resource to answer your questions and empower you throughout your home-buying journey.

Table of Contents

• Understanding Mortgages in Singapore
• HDB Loans vs Bank Loans: Key Differences
• Eligibility Requirements for First-Time Buyers
• Housing Grants and Schemes Available
• Calculating Your Mortgage Affordability
• Understanding Interest Rates and SORA
• The Mortgage Application Process
• Using Your CPF for Home Purchase
• Additional Costs and Fees to Budget
• Common Mistakes First-Time Buyers Make
• Frequently Asked Questions
• Your Next Steps with Homejourney

Understanding Mortgages in Singapore

A mortgage is a loan secured by the property you're purchasing. In Singapore, this means the bank or HDB holds a legal charge over your property until the loan is fully repaid. For first-time buyers, mortgages typically range from 25 to 30 years, with most banks offering loan-to-value (LTV) ratios of up to 75-80% for HDB flats and 75% for private properties.

The Singapore mortgage market is regulated by the Monetary Authority of Singapore (MAS) and operates under strict lending guidelines designed to protect both borrowers and lenders. As a first-time buyer, you have significant advantages—including access to government grants, priority allocation for HDB flats, and preferential lending terms from banks.

Understanding how mortgages work is fundamental to making smart financial decisions. Your monthly mortgage payment consists of two components: principal (the amount borrowed) and interest (the cost of borrowing). Early in your loan tenure, most of your payment goes toward interest. Over time, this ratio shifts, and more of your payment reduces your principal balance.

HDB Loans vs Bank Loans: Key Differences

Singapore offers two primary mortgage options for HDB flat purchases: HDB loans and bank loans. Each has distinct advantages, and choosing between them depends on your financial situation, preferences, and long-term plans.

HDB Loans

HDB loans are provided directly by the Housing and Development Board and are exclusively available for purchasing HDB flats. Key features include:

• Fixed interest rate: Currently set at 2.6% per annum, providing predictability and protection against rate increases
• No lock-in period: You can refinance or repay early without penalties
• Simpler approval process: Faster processing with fewer documentation requirements compared to banks
• Maximum loan amount: Up to 80% of the flat's purchase price or valuation, whichever is lower
• Tenure: Up to 30 years for first-time buyers
• No early repayment penalties: Repay your loan early without incurring additional charges

HDB loans are particularly attractive for first-time buyers seeking stability and simplicity. The fixed 2.6% rate provides certainty in your monthly payments, making budgeting straightforward. However, if interest rates fall significantly, you cannot benefit from lower rates unless you refinance to a bank loan.

Bank Loans

Bank loans are offered by commercial banks and can be used for HDB flats, executive condos, and private properties. Key features include:

• Variable interest rates: Typically pegged to SORA (Singapore Overnight Rate Average) plus a bank spread, allowing you to benefit from rate decreases
• Competitive rates: Banks compete for your business, often offering promotional rates for first-time buyers
• Flexibility: Options for fixed-rate periods, partial fixed-rate combinations, and various loan structures
• Maximum loan amount: Up to 75-80% LTV depending on property type and bank policies
• Tenure: Up to 30 years, with some banks offering extended tenures
• Additional features: Some banks offer mortgage protection insurance, balance transfer incentives, and cashback promotions

Bank loans offer flexibility and potential savings if interest rates decline. However, your monthly payment may fluctuate if you choose a variable rate, requiring budget flexibility. For detailed comparison of HDB and bank loan options, read our guide on HDB Loans vs Bank Loans for First-Time Buyers.

Comparison Table: HDB vs Bank Loans

Eligibility Requirements for First-Time Buyers

Understanding eligibility requirements is crucial before you begin your mortgage application. Singapore has specific criteria designed to ensure fair access to housing while managing financial risk.

Basic Eligibility Criteria

To qualify for an HDB loan or bank mortgage as a first-time buyer in Singapore, you must meet these fundamental requirements:

• Singapore citizenship: You or at least one co-applicant must be a Singapore citizen
• Age: Minimum 21 years old; maximum 65 years old at loan maturity (varies by bank)
• First-time buyer status: You and your spouse/co-applicants must not own any other residential property in Singapore
• Income stability: Employed for at least 3-6 months (requirements vary by lender)
• No outstanding HDB loans: You cannot have any existing HDB housing loans

Income Ceiling Requirements

HDB flats are classified as Standard, Plus, or Prime based on location and amenities. Each classification has income ceilings that determine eligibility:

• Standard flats: Monthly household income up to $14,000
• Plus flats: Monthly household income up to $21,000
• Prime flats: Monthly household income up to $35,000

These income ceilings apply at the time of HDB application. For bank loans on private properties, there are no income ceilings, but your debt servicing ratio (DSR) is assessed.

Debt Servicing Ratio (DSR) and Mortgage Servicing Ratio (MSR)

Banks evaluate your ability to service the mortgage using two key metrics:

• Debt Servicing Ratio (DSR): Your total monthly debt obligations (mortgage, car loans, credit cards, personal loans) cannot exceed 60% of your gross monthly income
• Mortgage Servicing Ratio (MSR): Your mortgage payment alone cannot exceed 30% of your gross monthly income

For example, if your monthly gross income is $8,000, your maximum mortgage payment should not exceed $2,400 (30% MSR). Your total debt obligations should not exceed $4,800 (60% DSR).

CPF Usage Requirements

Most first-time buyers use CPF to fund their property purchase. To be eligible:

• You must have sufficient CPF savings in your Ordinary Account (OA)
• CPF can be used for down payment, mortgage payments, and stamp duty
• Minimum CPF balance of $20,000 must remain in your OA after purchase
• Your CPF contribution history must show consistent employment

Housing Grants and Schemes Available to First-Time Buyers

Singapore's government provides substantial financial support to first-time homebuyers through various grants and schemes. These can significantly reduce your out-of-pocket costs and improve affordability.

Enhanced Housing Grant (EHG)

The Enhanced Housing Grant provides additional support to first-time buyers with lower to middle incomes. For families purchasing new HDB flats, grants reach up to $120,000[2], while resale flat purchases qualify for up to $230,000[2].

EHG eligibility depends on your household income and family composition. The grant is automatically credited to your CPF Ordinary Account, reducing the cash or CPF you need to pay upfront.

CPF Housing Grant (First Timer Grant)

This grant is available to first-time buyers and provides:

• Families: Up to $40,000 for new flats or $40,000 for resale flats
• Singles (35 and above): Up to $40,000 for new flats or $30,000 for resale flats

The grant is credited to your CPF OA and can be used for down payment or mortgage payments.

Proximity Housing Grant (PHG)

If you're buying a resale flat near your parents or adult children, you may qualify for the Proximity Housing Grant of up to $15,000. This grant encourages multigenerational living and family cohesion.

Family Care Scheme

The Family Care Scheme supports three-generation households by providing larger flats and financial assistance. Three-generation flats in developing areas like Sembawang are supported by this scheme[1], making them ideal for multigenerational families.

Shorter Waiting Time (SWT) Flats

HDB has launched 2,000 to 3,000 Shorter Waiting Time flats since 2024[2], with waiting periods of 2-3 years instead of the standard 3-4 years. At least 95% of 4-room and larger flat supply is set aside for first-timers[2], ensuring priority access to quality housing.

SWT flats are available in various locations and offer faster access to homeownership for families with urgent housing needs.

First-Timer Advantage

About 8 in 10 first-timer families buying new or resale flats today can afford their first flat without paying any cash out-of-pocket for mortgage instalments[2]. This means CPF and grants can cover your entire down payment and initial mortgage payments, making homeownership more accessible than ever.

Calculating Your Mortgage Affordability

Before applying for a mortgage, you need to understand how much you can afford to borrow and what your monthly payments will be. This requires honest assessment of your income, existing debts, and financial goals.

References

1. Singapore Property Market Analysis 2 (2026)
2. Singapore Property Market Analysis 1 (2026)