How to Use CPF for Your HDB Down Payment: A Step-by-Step Guide
Your CPF Ordinary Account (OA) is one of the most powerful tools available for purchasing an HDB flat in Singapore, allowing you to preserve your cash savings while building equity in your home. Whether you're a first-time buyer securing a Build-to-Order (BTO) flat or upgrading to a resale property, understanding how to strategically deploy your CPF can reduce your financial burden and accelerate your path to homeownership. At Homejourney, we're committed to helping you navigate this process safely and transparently, ensuring you make informed decisions backed by verified information.
This guide walks you through exactly how CPF works for HDB down payments, the latest 2026 regulations, and practical strategies to maximize your CPF benefits while minimizing your out-of-pocket cash requirements.
Understanding CPF for HDB Down Payments
Your CPF Ordinary Account is specifically designed to help you purchase a home. Unlike your Medisave Account (MA) or Special Account (SA), your OA savings can be fully deployed toward your HDB down payment and mortgage payments, making it the primary funding source for most first-time buyers.[1][6]
When you buy an HDB flat directly from HDB, you can use your OA savings for both the initial down payment and the remaining purchase price.[6] This is a significant advantage compared to private property purchases, where CPF usage is more restricted. For HDB loans specifically, there is no cash requirement for your down payment—you can pay the entire 25% down payment using CPF OA savings alone, giving you maximum flexibility.[1]
However, if you opt for a bank loan instead of an HDB loan, the rules change slightly. You'll need to pay at least 5% of the flat price in cash, while the remaining 20% can come from CPF OA savings or additional cash.[1] This distinction is crucial when deciding between an HDB loan and a bank loan, which we cover in detail in our HDB Loan vs Bank Loan 2026 Comparison | Homejourney ">HDB Loan vs Bank Loan comparison guide.
Down Payment Amounts and CPF Usage Rules
The amount you need to pay as a down payment depends on your loan type and eligibility status. Understanding these breakdowns is essential for planning your CPF withdrawal strategy.
Standard Down Payment Structure
For HDB Loans: You must pay 25% of the flat price as a down payment, and you can use 100% CPF OA savings for this amount.[1] There is no cash requirement. For a $400,000 flat, this means a $100,000 down payment that can come entirely from your CPF OA.
For Bank Loans: The minimum down payment is also 25%, but the composition differs. You must pay at least 5% in cash ($20,000 on a $400,000 flat), while the remaining 20% can come from CPF OA or additional cash.[1] This cash requirement is a key consideration when comparing financing options.
CPF OA Retention Option
As of August 2024, a new regulation allows buyers taking an HDB loan to retain up to S$20,000 in their CPF OA, allowing these funds to continue earning interest.[3] This is particularly valuable if your CPF OA balance is close to the down payment requirement—you can preserve some funds for emergencies or future needs while still completing your purchase.
The Staggered Down Payment Scheme: Reducing Your Initial Payment
One of the most significant advantages introduced in 2024 and refined in 2025 is the Staggered Down Payment Scheme, which allows eligible first-time buyers to spread their down payment across two stages rather than paying everything upfront.[1][2] This scheme is a game-changer for young couples and first-time buyers with limited savings.
How the Staggered Scheme Works
Under the staggered scheme, you pay your down payment in two instalments instead of one lump sum:[1][4]
- First Instalment (at Agreement for Lease signing): As low as 2.5% for eligible young couples with HDB loans, or 5% for most other first-time buyers. For bank loans, this stage requires 5-10% depending on eligibility.[1][4]
- Second Instalment (at key collection): The remaining 20-22.5% is paid 2-4 years later when you collect your keys, giving you significant time to accumulate additional CPF OA savings.[1]
This structure is revolutionary because it dramatically reduces the cash burden at the critical moment of booking your flat. Instead of needing $100,000 immediately, a young couple might only need $10,000-$20,000 at signing, with the remainder due years later when their income has likely increased.
Eligibility for the Staggered Down Payment Scheme
Not everyone qualifies for the staggered scheme. To be eligible, you must meet these criteria:[1][2][4]
- At least one applicant is aged 30 years or younger at the point of application
- Both applicants are first-time buyers, OR one is a first-timer and the other is a second-timer
- You have obtained a valid Housing Financial Eligibility (HFE) letter on or before the younger applicant's 30th birthday
- You have booked a 5-room or smaller flat (BTO, Sale of Balance, or Open Booking)
- The scheme applies only to uncompleted flats—resale flat buyers cannot use this scheme[2]
Young couples who qualify for the scheme and apply for an HDB loan can pay as little as 5% at signing, with the remaining 20% deferred to key collection.[4] This provides crucial financial breathing room during the early years of your mortgage.
CPF Housing Grants: Reducing Your Down Payment Further
Beyond your CPF OA savings, you may be eligible for CPF Housing Grants that directly reduce your down payment requirement. These grants are free money from the government designed to improve housing affordability.[2]
Enhanced CPF Housing Grant (EHG) 2025-2026
The Enhanced CPF Housing Grant has been significantly boosted:[2]
- First-time families: Up to $120,000
- Singles: Up to $60,000
When combined with other grants, eligible first-time families can receive up to $230,000 off a resale flat, while singles can get up to $115,000.[2] These grants are applied directly to your down payment, effectively reducing the amount you need to withdraw from your CPF OA or pay in cash.
For example, if you're a first-time family buying a $500,000 resale flat and receive the full $120,000 EHG, your down payment requirement drops from $125,000 (25%) to just $5,000 in actual cash or CPF withdrawal. This is transformative for affordability.
Step-by-Step: Using CPF for Your HDB Down Payment
Now that you understand the rules, here's the practical process for using your CPF OA to pay your HDB down payment:
Step 1: Check Your CPF OA Balance and Eligibility
Log into your CPF account online or visit any CPF service centre to review your current OA balance. Ensure you have sufficient funds for your anticipated down payment. Remember that your CPF OA also needs to support your monthly mortgage payments later, so don't deplete it entirely for the down payment.
Step 2: Obtain Your Housing Financial Eligibility (HFE) Letter
Before you can book a flat, you need an HFE letter from HDB confirming your eligibility to purchase. This letter verifies your income, family composition, and eligibility for grants. Apply for this through the HDB portal or at an HDB branch—it's free and typically processed within a few days.
Step 3: Determine Your Loan Type and Down Payment Structure
Decide whether you'll take an HDB loan or a bank loan. Use HDB Loan vs Bank Loan 2026 Comparison | Homejourney ">Homejourney's loan comparison tools to evaluate which option suits your financial situation. If eligible, confirm whether you qualify for the staggered down payment scheme to reduce your initial payment.
Step 4: Calculate Your Actual CPF Withdrawal Needed
Subtract any housing grants from your down payment requirement to determine how much you actually need to withdraw from CPF OA. For example:
- Flat price: $400,000
- Down payment (25%): $100,000
- Housing grant received: $80,000
- CPF OA withdrawal needed: $20,000
Step 5: Book Your Flat and Sign the Agreement for Lease
When you book your BTO or resale flat, you'll sign the Agreement for Lease. At this point, your first down payment instalment is due. If you're using the staggered scheme, this might be just 5% instead of the full 25%. CPF withdrawal is automatic—you don't need to manually withdraw funds. HDB or your bank will coordinate the CPF withdrawal directly from your account.
Step 6: Arrange Your Mortgage and Finalize Financing
Simultaneously with booking, you'll apply for your HDB loan or bank loan. If choosing a bank loan, use Homejourney's bank rates comparison page to compare offers from DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, and other major lenders. Our multi-bank application system allows you to submit one application and receive offers from multiple banks, saving you time and ensuring you get the best rate for your situation. You can even use Singpass to auto-fill your application in seconds.
Step 7: Pay Remaining Down Payment at Key Collection
When you collect your keys (typically 2-4 years after booking for BTO flats), the remaining down payment is due. Your CPF OA will have continued accumulating contributions from your employer during this period, so you'll likely have sufficient funds without additional cash outlay.
Pro Tips for Maximizing Your CPF for HDB Down Payments
Preserve Your CPF OA Balance: Remember that your CPF OA also funds your monthly mortgage payments. Don't withdraw every dollar for the down payment. Maintaining a buffer of $20,000-$30,000 gives you flexibility and preserves funds earning interest. Take advantage of the new CPF OA retention option that allows you to keep up to $20,000 untouched.[3]
Time Your Purchase Around Grant Cycles: Housing grants are periodically enhanced. If you're not in an urgent timeline, monitoring HDB announcements about grant increases can result in significantly larger subsidies. The recent EHG boost to $120,000 for families demonstrates the value of staying informed.
Leverage the Staggered Scheme if Eligible: If you qualify for the staggered down payment scheme, use it strategically. Paying just 5% upfront instead of 25% preserves $80,000 in your account that can continue earning interest or be used for renovations and furnishings.
Consider Your Spouse's CPF: If you're buying as a couple, both spouses' CPF OA can be used for the down payment. Coordinate your withdrawal strategy to optimize which spouse's account is drawn from, particularly if one spouse has significantly higher OA savings.
Understand Your Loan-to-Value (LTV) Limits: As of August 2024, both HDB and bank loans have an LTV limit of 75%, meaning your down payment must be at least 25%.[3] This hasn't changed, but it's important to factor into your planning—you cannot borrow more than 75% of the property value regardless of your income.
HDB Loan vs Bank Loan: CPF Usage Differences
Your choice between an HDB loan and a bank loan significantly impacts how you use CPF. Here's the key difference:
HDB Loan: You can pay the entire 25% down payment using CPF OA with zero cash requirement.[1] This is ideal if you have sufficient CPF savings and want to preserve cash.
Bank Loan: You must pay at least 5% in cash, with the remaining 20% coming from CPF or additional cash.[1] This requires some liquid cash reserves but may offer better interest rates depending on market conditions.
For a detailed comparison of these options and their long-term financial implications, read our HDB Loan vs Bank Loan 2026 Comparison | Homejourney ">HDB Loan vs Bank Loan guide.
Common CPF Down Payment Mistakes to Avoid
Mistake 1: Depleting Your Entire CPF OA for the Down Payment While you can use CPF for the down payment, leaving yourself with minimal OA balance creates cash flow problems. You'll need CPF OA for monthly mortgage payments, and maintaining a buffer is prudent.
Mistake 2: Not Applying for Housing Grants Many buyers overlook available grants, leaving money on the table. Always apply for your HFE letter and confirm your grant eligibility—this can reduce your down payment requirement by tens of thousands of dollars.
Mistake 3: Missing the Staggered Scheme Deadline If you're under 30 and a first-time buyer, you must obtain your HFE letter before your 30th birthday to qualify for the staggered scheme. Missing this deadline costs you the ability to defer 20% of your down payment.
