A term loan in Singapore is a financing solution specifically for property owners. This type of loan also known as an equity loan in Singapore, allows individuals to borrow against the value of their private property. Term loans are commonly used for significant expenses, such as renovations or investments, and are repaid through fixed monthly installments.
How Does a Term Loan in Singapore Work?
Here’s how it works:
Equity-Based Borrowing
A term loan in Singapore is secured against private property. Borrowers can only access this loan if the property’s value has increased and there is surplus equity after deducting any outstanding loans (principal and interest) and CPF contributions.
Cash-Based Repayments
Monthly repayments are made in cash, so borrowers must have a stable financial position to service the loan.
Eligibility Criteria
Borrowers must meet specific conditions in a home equity loan, including:
> Owning private property with adequate equity term loan.
> Ensuring no excessive outsanding loans remain on the property.
Loan Purpose
The funds can be used for various needs, such as education, home improvements, or consolidating debts.
A home equity loan in Singapore is a cash-out process that enables property owners to unlock their property’s value. The amount that can be borrowed depends on the excess value after subtracting existing liabilities tied to the property. A short term loan in Singapore is also available, offering quick financial relief for a few weeks to a few months.
