How Much Renovation Loan Can I Get In Singapore?
The question of how much renovation loan I can get in Singapore for your project depends on a few factors. In many cases is dependent on the type of aesthetics you choose. For example, the Optional Component Scheme can offer a loan of $5,000 and above.
Here we’ll discuss more of the factors determining how much renovation loan you get and other issues surrounding renovation loans in Singapore. We hope you get to the end for a better understanding.
How Do Renovation Loans Work In Singapore?
Renovation loans are specifically meant to cover the cost of your home renovations. The loan differs from a home loan meant to finance mortgages.
Renovation loans have lower rest interest rates. This means their monthly rates are calculated according to the remaining loan balance.
The loan comes with different packages and restrictions regarding what you can pay for with it. Also, the money is directly given to your contractor or interior designer, not you.
Generally, they have a loan tenure of between one and five years. The maximum loan you can take is six times your annual salary or $30,000, whichever amount is lower.
If your need disbursement in installments, some banks charge some extra fees. Therefore ensure you understand loan terms before agreeing.
What Can Renovation Loans Be Used To Pay For?
Remember, renovation loans restrict what they can only pay for in Singapore. The list is broad and covers most of the work needed.
Also, the list differs with different banks. Here is a list of what a DBS renovation loan covers.
- Electricity and wiring
- Redecorating and painting
- Floors and tiles
- Fitted cabinets
- Structural adjustments
- Basic bathroom installations
- External works within the house compound
What Should You Look Out For In A Renovation Loan?
When you are debating on the question of how much a renovation loan can I get, you should be careful of these:
- Processing fee. Different banks have different processing fees. Ensure you take a loan with reasonable and low processing fees.
- Additional fees. Some banks have extra fees if you make late payments, cancel or make early payments.
- Continuing promotions. Ensure you understand and take advantage of ongoing promotions before you sign for a loan.
- Interest rate. How much interest rate is the moneylending company quoting? Ensure the loan interest is set at a monthly rest rate.
How Much Do Home Renovations Cost?
Home renovations can cost between $20,000 and $70,000. Here is an example of the average renovation costs of different rooms.
| Type Of HDB Home | Estimate Renovation Cost If It’s New | Estimate Renovation Cost If It’s A Resale |
|---|---|---|
| Three rooms of between 60 and 65 square meters | $32,000 | $42,600 |
| Four rooms of between 90 sqm | $42,600 | $58,500 |
| Five rooms of around 110 sqm | $52,100 | $65,200 |
The cost also depends on several factors:
- The size and kind of your home. The larger the home is, the more materials and work you’ll need. This, in turn, adds to the total bill.
- The status of your home is it new or resale? Resale homes are more expensive to do renovations because they have extra fitted furniture that needs dismantling. A resale home can cost up to 40%.
- Who do you employ to renovate for you? The company you choose to work for can contribute alot to the final cost.
- The kind and amount of work needed. Costs of renovations come from work in different places. Therefore the more work you have, the higher the cost of renovation.
- The materials you choose to use. For instance, your renovation budget might go higher if you use marbled bathrooms, granite tops, or heavy wood doors.
How Much Renovation Loan Can I Get?
You can apply for a renovation loan of up to six times your monthly income or S$30,000, whichever amount is lower. This loan amount, though, is approved based on your credit score and history.
You can also take a loan of more cash, like $50,000. The difference is the loan will come with a higher interest. You have to consider your Total Debt Servicing Ratio (TDSR).
Best Renovation Loans In Singapore
Here is a market listing of home renovation loans. This list will help you choose the loan that suits your budget to repay your loan on time and avoid charges.
| CIMB Renovation Loan | DBS And POSB Renovation Loan | Maybank Home Renovation Loan | OCBC Renovation Loan | |
|---|---|---|---|---|
| Interest Rate Per Annum | 3.88% effective interest rate is 4.29% | 4.18% EIR 4.91% | 3.88% for existing customers of home loans 4.98% for new borrowers | 4.18% EIR of 4.80% Ecp-care renovation loan 3.98% EIR of 4.60% |
| Loan Period | One to five years | One to five years | One to five years | One to five years |
| Processing Charges | 1% of the approved money | 1% of approved amount | 0.5% of the approved amount | 0.5% of the approved amount |
| Loan Amount | Six times monthly income or $30,000 whichever is lower | Six times monthly income or $30,000 whichever is lower | Six times monthly income or $30,000 whichever is lower | Six times monthly income or $30,000 whichever is lower |
| Minimum Annual Income | $24,000 | $24,000 | $30,000 | $24,000 |
Get A Home Renovation Loan Today To Get The Proper Aesthetics For Your Home
Home renovation loans are what you need to renovate your brand-new or resale home. High-quality renovation loans come from banks or licenced money lenders. Ensure you pick the loan you can manage, and several factors, like the materials you choose to use, can significantly increase your loan budget.
When you decide on getting a home renovation loan, visit Katong Credit. We are a licensed moneylender in Singapore offering quick financing. Get a fast home renovation loan with us and the lowest interest rates.
Frequently Asked Questions
What Can’t I Pay With My Home Renovation Loan?
You can’t pay for reasons that go beyond renovation purposes. You can only pay for renovation supplies, installing applications, etc.
Who Can Apply For Renovation Loans?
A Singapore citizen or a permanent resident between the ages of 21 and 65, but the maximum period differs with different banks. You should earn a minimum annual salary of $24,000, the homeowner or someone related with the owner’s consent.
What Are The Common Fees Involved In Renovation Loans?
Processing or handling fee of 1% of the approved amount, late payment fee of $80, early repayment fee of 1 or 2% of the remaining balance and cancellation fee of 1% on loan cancelled.
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