Securing a new home loan in Singapore or refinancing an existing mortgage can be a complex process for homeowners. With the multiple steps in the mortgage loan process, differing paperwork required, and varying home loan packages on the market, it can be time-consuming and difficult to get a new home loan.
To help you, we’ve put together this guide to take you step by step through the entire mortgage loan process. We will include the typical home loan processing time, from the initial mortgage application to the final approval.
As a bonus, we’ll show you how PropertyGuru Finance is a one-stop online portal where you can seamlessly and quickly secure your new home loan in 5 easy steps.
5 Steps to Getting a New Home Loan with PropertyGuru Finance
| Doing your pre-qualification check | Up to seven days; or immediately with our home loan pre-qualification check |
| Comparing mortgage packages | Up to two weeks; or instantly with the PropertyGuru Finance mortgage comparison tool |
| Getting your IPA | Up to three days |
| Mortgage application | A few days to a week |
| Letter of Offer | Receive it up to a week from when your loan is approved |
1. Do Your Home Loan Pre-qualification Check
The first step is to do your pre-qualification check. This provides you with an estimate of how likely you are to qualify for your desired loan amount.
At this stage, you can approach a bank you would like to take a home loan from to assess your income and existing financial commitments. After they have run the numbers, they will present you with an estimate. The process can take up to seven days.
Note that at this step, a bank has not given you any ‘official’ commitment on whether they will extend you a loan. Some opt to skip this step but we do find it useful to budget for your property purchase.
To save time, you can do your pre-qualification check for your bank loan with ease through PropertyGuru Finance. Using our secure online tool, you can quickly get a digital, bank-backed estimate on your potential loan amount at your convenience.
2. Compare the Various Mortgage Packages
Once you’ve got your pre-qualification check completed, you’ll want to get matched to the best home loan for you. While you can approach each bank individually and enquire about their best rates, this can be a time-consuming task. Depending on how quickly the different lenders get back to you, cross-comparing the various rates can take a week or two.
Alternatively, you can use online mortgage comparison tools to instantly get the most updated mortgage interest rates.
However, the lowest mortgage rates are not the only thing homeowners should focus on when choosing the best home loan for you. You’ll also need to consider whether you want to take a fixed or floating rate mortgage home loan, the lock-in period, if there are promotional discounts and cash rewards offered, among other factors.
Once you’ve selected a home loan that matches your financial needs and goals, our friendly and knowledgeable Mortgage Experts will assist you in securing your desired mortgage. That brings us to the next step: securing your In-Principle Approval (IPA)
3. Get your IPA
For those who are unfamiliar with the term, an IPA is a document from your chosen bank, clearly stating how much they are willing to lend you and the loan term. Additionally, you know you have a lender ready to disburse your desired loan.
Unlike the pre-qualification stage, lenders will do legal, bankruptcy, and credit checks before conferring you an IPA. The IPA takes into account your Total Debt Servicing Ratio (TDSR), Mortgage Servicing Ratio (MSR) (if relevant), income and credit score.
You can also watch this video to understand the difference between pre-approvals and pre-qualifications.
Usually, you can get your IPA within three working days. Having an IPA can accelerate the loan disbursal process. In practice, the home loan process is more or less guaranteed when you get a pre-approval.
If you’re buying a new property, you want to secure your IPA before paying the option fee for your property. Some property agents may request an IPA before proceeding with the sale. That’s because if the loan amount you can obtain is insufficient to finance your property, you will be unable to buy the property or recover your option fee.
4. Apply for Your Mortgage
Once you’ve secured your IPA, it is finally time to apply for your desired home loan. If all your documents are in order, bank loans typically take a few days to a week to obtain approval.
You’ll need the following documents for a mortgage application:
- NRIC (if there are any foreign borrowers, a passport is required)
- Statements of the past 12 months of your CPF contributions
- Payslips for the past three months
- Latest year Notice of Assessment (NOA) from IRAS
- Any credit card statements
- Statements detailing any existing loans/repayments (i.e. student loans and car loans)
Apply for your desired home loan online with PropertyGuru Finance. The streamlined and guided digital application process is available for all major banks in Singapore and allows you to condense your documents in a single place.
Once your mortgage application has been approved, your lender will send you the Letter of Offer (LO).
5. Receive Your Letter of Offer
This is the last step: receiving the Letter of Offer. The document is proof of financing being available. Alongside the Letter of Offer, the bank will present you with the Residential Loan Property Fact Sheet, a document stating the terms and conditions of the specific loan package. It will clearly state the terms of the loan offered and include the loan amount, loan tenure, mortgage interest rate structure, repayment dates, penalty clauses, and other relevant loan terms.
When you accept and sign the terms of the Letter of Offer, congratulations! You’ve secured a new home loan in Singapore.
Should You Consult a Mortgage Expert When Applying for Your Home Loan
| With a Mortgage Expert | Without a Mortgage Expert / Independent Research |
| Peace of mind as you have a expert guiding you through the process and assisting in paperwork | You have to navigate the home loan process alone. If you miss out certain paperwork, you may have to resubmit the mortgage application or have your approval be delayed |
| Expert home financing advice to make informed decisions | You may have blindspots or be unsure of which factors to consider when choosing the best home loan for you |
| Have a hassle-free experience which is convenient and saves time | Having to compare information from various sources, which may be conflicting, can be confusing and time-consuming |
| Easy to cross-compare bank loans as they have access to updated information for all banks | For those unfamiliar with loans offered by different banks, obtaining necessary information and cross-comapring rates can be tedious |
| Personalised service for you to achieve your financial goals | May have to go through different people to secure your home loan; there may be confusion at the various stages of the home loan process |
Whether you’re a first-time homebuyer or an existing homeowner looking to refinance your current mortgage, being familiar with the ins and outs of the mortgage loan process can smoothen your home loan journey.
One question you may be wondering is if it’s worth it to consult a mortgage expert when applying for a home loan. While it is possible to apply for a home loan on your own, leveraging the expertise of a mortgage expert can be a good move. Aside from saving time, you have someone to guide you through the many steps and make informed decisions.
With a PropertyGuru Finance Mortgage Expert, you have an expert who can provide you a one-stop service and unbiased views when selecting a home loan. They can provide you with tips to make the mortgage application process as efficient as possible. Best of all? It’s free!
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