HDB Loan vs Bank Loan in 2026: Rates, Eligibility, Downpayment
HDB loan or bank loan in 2026? Eligibility, the S$16,000 income ceiling, 75% LTV, 2.6% vs SORA rates, downpayments and a worked S$600,000 flat example.
To finance an HDB flat you choose between two loans: an HDB concessionary loan at 2.6% a year, or a bank loan. Both now lend up to 75% of the price. In October 2026 bank packages are cheaper, at about 1.5–1.8% floating and 2.0–2.2% fixed (The Business Times, 2 Oct 2026). The HDB loan costs more but gives you a stable rate, lets you pay the whole downpayment from CPF, and has no early repayment penalty. The right choice depends on your cash, your appetite for rate risk and whether you qualify.
At a glance
- HDB loan: up to 75% of the price or valuation, 2.6% a year, up to 25 years. You need at least one Singapore citizen buyer and a household income of S$16,000 or less a month.
- Bank loan: also up to 75%, but at least 5% of the price must be cash. Tenure is up to 30 years, but the limit falls to 55% if the loan runs past 25 years.
- On a S$450,000 loan over 25 years, 2.6% costs about S$2,042 a month and a 1.8% bank floating rate about S$1,864. The bank saves you about S$180 a month until its rate changes.
- You can refinance from an HDB loan to a bank loan, but never back again.
What has changed since this guide first ran
If you arrived from an old link, several numbers in the 2016 version are now wrong:
| Item | 2016 | October 2026 |
|---|---|---|
| HDB loan limit | 90% | 75% (since 20 Aug 2024) |
| Family income ceiling for HDB loan | S$12,000 | S$16,000 (since 24 Aug 2026) |
| Singles’ income ceiling | S$6,000 | S$8,000 |
| Bank loan benchmarks | SIBOR, SOR, board rates | SORA or fixed rates |
| TDSR | 60% | 55% |
| Eligibility check | HLE letter | HFE letter |
Sources: gov.sg HDB loans guide (updated 23 Aug 2026), HDB, 23 Aug 2026, MAS — TDSR.
SIBOR and SOR have been discontinued. Floating bank loans now use the Singapore Overnight Rate Average (SORA). On 14 Oct 2026, 3-month compounded SORA was about 1.24%.
Who qualifies for an HDB loan
The gov.sg HDB loans guide sets these conditions:
- At least one buyer is a Singapore citizen.
- Gross monthly household income is S$16,000 or less for families, or S$8,000 or less for singles. Extended families have a higher ceiling of S$24,000.
- You have not taken two or more HDB loans before.
- You do not own private residential property, in Singapore or overseas, and have not sold one in the 30 months before your HFE application.
- You are working when you apply for the HFE letter and when the loan is disbursed.
Apply for the HDB Flat Eligibility (HFE) letter before you book a flat or accept an option to purchase for a resale flat. It confirms whether you can buy, which grants you get and how much HDB will lend. You cannot switch to an HDB loan after you complete with a bank loan, so decide before you buy.
PR-only households, and anyone above the income ceiling, must use a bank loan.
How much you can borrow
The loan is the lowest of these:
- 75% of the price, or for resale flats 75% of the price or valuation, whichever is lower.
- What your income supports. The mortgage servicing ratio (MSR) caps instalments on HDB flats at 30% of gross monthly income. HDB tests this at an interest rate of at least 3%. Banks test it at 4%.
- The tenure cap. For an HDB loan, the tenure is the shortest of 25 years, 65 minus the buyers’ average age, or the remaining lease minus 20 years.
- 1Limit 175% of the priceFor a resale flat, 75% of the price or the valuation, whichever is lower.
- 2Limit 2What your income supportsThe mortgage servicing ratio caps instalments at 30% of gross monthly income. HDB tests this at a rate of at least 3%. Banks test it at 4%.
- 3Limit 3The tenure capFor an HDB loan, the shortest of 25 years, 65 minus the buyers' average age, or the remaining lease minus 20 years.
Source: gov.sg, HDB loans guide (October 2026); MAS, MSR and TDSR rules.
Before HDB lends, you must use the CPF Ordinary Account (OA) savings you have. Each buyer may keep up to S$20,000 in the OA as a buffer. If you are taking a second HDB loan, you must also put in the full CPF refund and part of the cash proceeds from the flat you sold.
The stress test matters more than the headline rate. On a S$450,000 loan over 25 years:
| Lender | Assessment rate | Instalment used for MSR | Income needed at 30% MSR |
|---|---|---|---|
| HDB | 3% | about S$2,134 | about S$7,110 |
| Bank | 4% | about S$2,375 | about S$7,920 |
So with the same income, a buyer may qualify for a larger HDB loan than bank loan.
Downpayment: where the cash goes
This is often the deciding factor for young couples.
- HDB loan: the downpayment is 25%, and you can pay all of it from CPF OA, cash, or both. For a new flat, 10% is due when you sign the Agreement for Lease and the other 15% at key collection (gov.sg BTO buying guide).
- Bank loan at 75%: also 25% in total, but at least 5% must be cash. For a new flat, 20% is due at the Agreement for Lease and the other 5% at key collection. If the bank loan runs past 25 years, the limit falls to 55% and the minimum cash rises to 10%.
| When | HDB loan | Bank loan at 75% |
|---|---|---|
| Agreement for Lease | 10% of the price | 20% of the price |
| Key collection | 15% of the price | 5% of the price |
| Cash you must pay | None required: CPF OA can cover all of it | At least 5% of the price |
Source: gov.sg, HDB BTO and SBF buying guide (October 2026); gov.sg, HDB loans guide. If a bank loan runs past 25 years, the limit falls to 55% and the minimum cash rises to 10%.
Example. Say you buy a S$600,000 resale flat that values at S$600,000:
- HDB loan: borrow S$450,000. Pay the S$150,000 downpayment from CPF if your OA balances cover it.
- Bank loan: borrow S$450,000. Pay S$150,000, of which at least S$30,000 must be cash.
If the price is above the valuation, the difference is cash over valuation (COV). You pay it in cash on top of the downpayment, because both lenders lend only on the lower figure.
First-timers buying resale may get up to S$230,000 in grants, which cuts what you need to borrow. See the HDB grants guide.
The interest-rate maths
Home loans are amortised. Each month’s interest is charged on the balance still owed, unlike the flat-rate method used for car loans. That is why paying down principal early saves real money.
Example: S$450,000 over 25 years
| Rate | Monthly instalment | Total interest over 25 years |
|---|---|---|
| HDB 2.6% | about S$2,042 | about S$162,500 |
| Bank 1.8% (if it stayed there) | about S$1,864 | about S$109,200 |
| Bank 3.5% (if rates rose) | about S$2,253 | about S$225,800 |
Over the first two years, the 1.8% loan charges about S$15,700 in interest against about S$22,800 for HDB, a saving of roughly S$7,100. That gap is why many buyers pick banks when rates are low.
Total interest over 25 years
Source: gov.sg HDB loans guide (HDB rate); The Business Times (bank rates), Propwise calculation (October 2026); The Business Times, 2 October 2026. Illustrations, not offers. Monthly instalments are about S$2,042, S$1,864 and S$2,253 in the order shown.
The catch is that bank rates do not stay fixed. Fixed packages usually reset after two or three years. Floating packages move with SORA every month. SORA was only about 1.24% on 14 Oct 2026, but it was far higher in 2023. If rates return to those levels, a bank loan can cost more than HDB’s 2.6%.
- 3-month compounded SORA (Singapore)
- US federal funds rate (effective)
Latest: SORA 1.24% (14 Oct 2026); Fed 3.88% (13 Oct 2026).
SORA is the benchmark for floating-rate home loans in Singapore. The US rate is shown for context: it moves SORA only indirectly, through the Singapore dollar and bank funding costs.
Table view
| Period | 3-month compounded SORA (Singapore) | US federal funds rate (effective) |
|---|---|---|
| Oct 2026 | 1.24% | 3.88% |
| Sep 2026 | 1.23% | 3.88% |
| Aug 2026 | 1.18% | 3.63% |
| Jul 2026 | 1.14% | 3.63% |
| Jun 2026 | 1.08% | 3.63% |
| May 2026 | 1.06% | 3.62% |
| Apr 2026 | 1.03% | 3.64% |
| Mar 2026 | 1.07% | 3.64% |
| Feb 2026 | 1.12% | 3.64% |
| Jan 2026 | 1.15% | 3.64% |
| Dec 2025 | 1.19% | 3.64% |
| Nov 2025 | 1.25% | 3.89% |
| Oct 2025 | 1.32% | 4.11% |
| Sep 2025 | 1.46% | 4.09% |
| Aug 2025 | 1.56% | 4.33% |
| Jul 2025 | 1.86% | 4.33% |
| Jun 2025 | 2.06% | 4.33% |
| May 2025 | 2.27% | 4.33% |
| Apr 2025 | 2.40% | 4.33% |
| Mar 2025 | 2.55% | 4.33% |
| Feb 2025 | 2.73% | 4.33% |
| Jan 2025 | 2.90% | 4.33% |
| Dec 2024 | 3.08% | 4.33% |
| Nov 2024 | 3.21% | 4.58% |
| Oct 2024 | 3.39% | 4.83% |
| Sep 2024 | 3.49% | 4.83% |
| Aug 2024 | 3.57% | 5.33% |
| Jul 2024 | 3.64% | 5.33% |
| Jun 2024 | 3.63% | 5.33% |
| May 2024 | 3.66% | 5.33% |
| Apr 2024 | 3.65% | 5.33% |
| Mar 2024 | 3.68% | 5.33% |
| Feb 2024 | 3.64% | 5.33% |
| Jan 2024 | 3.66% | 5.33% |
| Dec 2023 | 3.70% | 5.33% |
| Nov 2023 | 3.75% | 5.33% |
| Oct 2023 | 3.75% | 5.33% |
| Sep 2023 | 3.70% | 5.33% |
| Aug 2023 | 3.70% | 5.33% |
| Jul 2023 | 3.68% | 5.33% |
| Jun 2023 | 3.65% | 5.07% |
| May 2023 | 3.61% | 5.08% |
| Apr 2023 | 3.61% | 4.83% |
| Mar 2023 | 3.58% | 4.83% |
| Feb 2023 | 3.23% | 4.58% |
| Jan 2023 | 3.12% | 4.33% |
| Dec 2022 | 3.03% | 4.33% |
| Nov 2022 | 2.87% | 3.83% |
| Oct 2022 | 2.45% | 3.08% |
| Sep 2022 | 2.07% | 3.08% |
| Aug 2022 | 1.55% | 2.33% |
| Jul 2022 | 1.27% | 2.32% |
| Jun 2022 | 0.72% | 1.58% |
| May 2022 | 0.52% | 0.83% |
| Apr 2022 | 0.32% | 0.33% |
| Mar 2022 | 0.27% | 0.33% |
| Feb 2022 | 0.25% | 0.08% |
| Jan 2022 | 0.20% | 0.08% |
| Dec 2021 | 0.19% | 0.08% |
| Nov 2021 | 0.16% | 0.08% |
| Oct 2021 | 0.16% | 0.07% |
| Sep 2021 | 0.13% | 0.08% |
| Aug 2021 | 0.13% | 0.08% |
| Jul 2021 | 0.13% | 0.10% |
| Jun 2021 | 0.14% | 0.10% |
| May 2021 | 0.17% | 0.05% |
| Apr 2021 | 0.19% | 0.07% |
| Mar 2021 | 0.23% | 0.07% |
| Feb 2021 | 0.20% | 0.07% |
| Jan 2021 | 0.17% | 0.07% |
| Dec 2020 | 0.17% | 0.09% |
| Nov 2020 | 0.12% | 0.08% |
| Oct 2020 | 0.12% | 0.09% |
| Sep 2020 | 0.10% | 0.09% |
| Aug 2020 | 0.10% | 0.09% |
| Jul 2020 | 0.08% | 0.09% |
| Jun 2020 | 0.14% | 0.08% |
| May 2020 | 0.27% | 0.05% |
| Apr 2020 | 0.53% | 0.05% |
| Mar 2020 | 0.90% | 0.10% |
| Feb 2020 | 1.14% | 1.58% |
| Jan 2020 | 1.20% | 1.55% |
| Dec 2019 | 1.27% | 1.55% |
| Nov 2019 | 1.31% | 1.55% |
| Oct 2019 | 1.46% | 1.83% |
| Sep 2019 | 1.53% | 1.83% |
| Aug 2019 | 1.59% | 2.12% |
| Jul 2019 | 1.67% | 2.40% |
| Jun 2019 | 1.72% | 2.40% |
| May 2019 | 1.68% | 2.38% |
| Apr 2019 | 1.62% | 2.44% |
| Mar 2019 | 1.54% | 2.43% |
| Feb 2019 | 1.59% | 2.40% |
| Jan 2019 | 1.52% | 2.40% |
The HDB rate is not fixed by law either. It is pegged at 0.1 percentage point above the CPF OA rate and reviewed every quarter. It has stayed at 2.6% for many years because the OA rate has stayed at 2.5%.
- 3-month compounded SORA
- HDB concessionary loan rate
- CPF Ordinary Account rate
Latest: SORA 1.24% (14 Oct 2026); HDB loan 2.60% (Q4 2026); CPF OA 2.50% (Q4 2026).
The HDB rate follows the OA rate by formula and has not moved since 2015. A bank loan priced off SORA moves with the line for SORA, plus the bank's spread.
Table view
| Period | 3-month compounded SORA | HDB concessionary loan rate | CPF Ordinary Account rate |
|---|---|---|---|
| Oct 2026 | 1.24% | – | – |
| Q4 2026 | – | 2.60% | 2.50% |
| Sep 2026 | 1.23% | – | – |
| Aug 2026 | 1.19% | – | – |
| Jul 2026 | 1.14% | – | – |
| Q3 2026 | – | 2.60% | 2.50% |
| Jun 2026 | 1.08% | – | – |
| May 2026 | 1.06% | – | – |
| Apr 2026 | 1.03% | – | – |
| Q2 2026 | – | 2.60% | 2.50% |
| Mar 2026 | 1.07% | – | – |
| Feb 2026 | 1.12% | – | – |
| Jan 2026 | 1.15% | – | – |
| Q1 2026 | – | 2.60% | 2.50% |
| Dec 2025 | 1.19% | – | – |
| Nov 2025 | 1.25% | – | – |
| Oct 2025 | 1.32% | – | – |
| Q4 2025 | – | 2.60% | 2.50% |
| Sep 2025 | 1.45% | – | – |
| Aug 2025 | 1.56% | – | – |
| Jul 2025 | 1.85% | – | – |
| Q3 2025 | – | 2.60% | 2.50% |
| Jun 2025 | 2.05% | – | – |
| May 2025 | 2.27% | – | – |
| Apr 2025 | 2.36% | – | – |
| Q2 2025 | – | 2.60% | 2.50% |
| Mar 2025 | 2.55% | – | – |
| Feb 2025 | 2.73% | – | – |
| Jan 2025 | 2.90% | – | – |
| Q1 2025 | – | 2.60% | 2.50% |
| Dec 2024 | 3.03% | – | – |
| Nov 2024 | 3.21% | – | – |
| Oct 2024 | 3.38% | – | – |
| Q4 2024 | – | 2.60% | 2.50% |
| Sep 2024 | 3.49% | – | – |
| Aug 2024 | 3.57% | – | – |
| Jul 2024 | 3.64% | – | – |
| Q3 2024 | – | 2.60% | 2.50% |
| Jun 2024 | 3.63% | – | – |
| May 2024 | 3.66% | – | – |
| Apr 2024 | 3.65% | – | – |
| Q2 2024 | – | 2.60% | 2.50% |
| Mar 2024 | 3.68% | – | – |
| Feb 2024 | 3.65% | – | – |
| Jan 2024 | 3.65% | – | – |
| Q1 2024 | – | 2.60% | 2.50% |
| Dec 2023 | 3.70% | – | – |
| Nov 2023 | 3.75% | – | – |
| Oct 2023 | 3.75% | – | – |
| Q4 2023 | – | 2.60% | 2.50% |
| Sep 2023 | 3.70% | – | – |
| Aug 2023 | 3.70% | – | – |
| Jul 2023 | 3.67% | – | – |
| Q3 2023 | – | 2.60% | 2.50% |
| Jun 2023 | 3.65% | – | – |
| May 2023 | 3.62% | – | – |
| Apr 2023 | 3.61% | – | – |
| Q2 2023 | – | 2.60% | 2.50% |
| Mar 2023 | 3.58% | – | – |
| Feb 2023 | 3.22% | – | – |
| Jan 2023 | 3.14% | – | – |
| Q1 2023 | – | 2.60% | 2.50% |
| Dec 2022 | 3.03% | – | – |
| Nov 2022 | 2.92% | – | – |
| Oct 2022 | 2.46% | – | – |
| Q4 2022 | – | 2.60% | 2.50% |
| Sep 2022 | 2.07% | – | – |
| Aug 2022 | 1.60% | – | – |
| Jul 2022 | 1.27% | – | – |
| Q3 2022 | – | 2.60% | 2.50% |
| Jun 2022 | 0.77% | – | – |
| May 2022 | 0.53% | – | – |
| Apr 2022 | 0.32% | – | – |
| Q2 2022 | – | 2.60% | 2.50% |
| Mar 2022 | 0.28% | – | – |
| Feb 2022 | 0.25% | – | – |
| Jan 2022 | 0.21% | – | – |
| Q1 2022 | – | 2.60% | 2.50% |
| Dec 2021 | 0.19% | – | – |
| Nov 2021 | 0.16% | – | – |
| Oct 2021 | 0.16% | – | – |
| Q4 2021 | – | 2.60% | 2.50% |
| Sep 2021 | 0.13% | – | – |
| Aug 2021 | 0.13% | – | – |
| Jul 2021 | 0.13% | – | – |
| Q3 2021 | – | 2.60% | 2.50% |
| Jun 2021 | 0.13% | – | – |
| May 2021 | 0.17% | – | – |
| Apr 2021 | 0.19% | – | – |
| Q2 2021 | – | 2.60% | 2.50% |
| Mar 2021 | 0.22% | – | – |
| Feb 2021 | 0.20% | – | – |
| Jan 2021 | 0.17% | – | – |
| Q1 2021 | – | 2.60% | 2.50% |
| Dec 2020 | 0.17% | – | – |
| Nov 2020 | 0.12% | – | – |
| Oct 2020 | 0.12% | – | – |
| Q4 2020 | – | 2.60% | 2.50% |
| Sep 2020 | 0.10% | – | – |
| Aug 2020 | 0.10% | – | – |
| Jul 2020 | 0.08% | – | – |
| Q3 2020 | – | 2.60% | 2.50% |
| Jun 2020 | 0.14% | – | – |
| May 2020 | 0.27% | – | – |
| Apr 2020 | 0.53% | – | – |
| Q2 2020 | – | 2.60% | 2.50% |
| Mar 2020 | 0.88% | – | – |
| Feb 2020 | 1.14% | – | – |
| Jan 2020 | 1.20% | – | – |
| Q1 2020 | – | 2.60% | 2.50% |
| Dec 2019 | 1.26% | – | – |
| Nov 2019 | 1.31% | – | – |
| Oct 2019 | 1.46% | – | – |
| Q4 2019 | – | 2.60% | 2.50% |
| Sep 2019 | 1.53% | – | – |
| Aug 2019 | 1.59% | – | – |
| Jul 2019 | 1.67% | – | – |
| Q3 2019 | – | 2.60% | 2.50% |
| Jun 2019 | 1.72% | – | – |
| May 2019 | 1.68% | – | – |
| Apr 2019 | 1.62% | – | – |
| Q2 2019 | – | 2.60% | 2.50% |
| Mar 2019 | 1.54% | – | – |
| Feb 2019 | 1.59% | – | – |
| Jan 2019 | 1.55% | – | – |
| Q1 2019 | – | 2.60% | 2.50% |
Try your own numbers in the Propwise mortgage calculator.
HDB loan vs bank loan, side by side
| HDB loan | Bank loan | |
|---|---|---|
| Who can get it | SC household within income ceiling | Anyone the bank approves, incl. PR households |
| Maximum loan | 75% | 75% (55% if tenure > 25 years) |
| Minimum cash | None | 5% (10% at 55% LTV) |
| Maximum tenure | 25 years | 30 years |
| Rate in Oct 2026 | 2.6%, reviewed quarterly | About 1.5–2.2%, resets or floats |
| Early repayment | No penalty | Often a penalty during the lock-in period |
| Switching | Can refinance to a bank | Can refinance to another bank, never to HDB |
Before you choose a bank, read the letter of offer for lock-in periods, penalties, clawbacks of legal subsidies and what happens to the rate after the fixed period. Our mini guide to refinancing covers this.
How to choose
- Short of cash? The HDB loan lets you pay the full downpayment from CPF. A bank needs at least 5% in cash.
- Want certainty? A 2.6% rate that has not changed for years is easier to plan around than a SORA loan.
- Have spare cash and can handle rate swings? A bank loan is cheaper today, and you can refinance when the lock-in ends. Keep a buffer in case rates rise.
- Not eligible for HDB? PR-only households, buyers above the income ceiling and owners of private property must use banks.
- Want to switch later? Starting with HDB keeps both options open. Starting with a bank does not.
A longer tenure lowers the instalment but raises total interest. For the trade-offs, see 4 benefits of opting for a longer loan tenor, and remember the 25-year line for bank loans on HDB flats.
Bottom line
In 2026 the gap between the two loans is the familiar one. Banks are cheaper while rates stay low, and HDB is safer and needs less cash. Both lend up to 75%. HDB lets you use CPF for the whole downpayment, and its stress test is gentler, so you may be able to borrow more. Get your HFE letter early, compare at least two bank offers against 2.6%, and stress-test any bank quote at 3.5% to 4% before you sign. The move from HDB to a bank is one-way.
