1. What is the Property Loan Payment Formula?

The property loan payment formula calculates the fixed monthly payment required to repay a loan over a specified term. This is the standard calculation used by banks in Singapore for property loans.

2. How Does the Calculator Work?

The calculator uses the standard loan payment formula:

Where:

• \( P \) — Principal loan amount (SGD)
• \( r \) — Monthly interest rate (annual rate divided by 12)
• \( n \) — Total number of payments (loan term in years × 12)
• \( PMT \) — Monthly payment amount (SGD)

Explanation: The formula calculates the fixed payment needed to fully amortize the loan over its term, accounting for both principal and interest.

3. Importance of Loan Calculation

Details: Accurate loan payment calculation helps borrowers understand their financial commitments, compare loan offers, and plan their budgets when purchasing property in Singapore.

4. Using the Calculator

Tips: Enter the principal amount in SGD, annual interest rate (e.g., 2.75 for DBS's rate), and loan tenure in years (typically 25-30 years for Singapore properties).

5. Frequently Asked Questions (FAQ)

Q1: What is a typical interest rate in Singapore?
A: As of 2023, rates range from 2.75% to 4.5% depending on bank and loan package (fixed vs floating rate).

Q2: How does loan tenure affect payments?
A: Longer tenures reduce monthly payments but increase total interest paid over the loan's lifetime.

Q3: Are there other costs besides the monthly payment?
A: Yes, property purchases in Singapore include stamp duties, legal fees, and possible mortgage insurance.

Q4: What is TDSR in Singapore?
A: Total Debt Servicing Ratio (TDSR) limits your monthly debt repayments to 55% of your gross monthly income.

Q5: Can I get 100% financing in Singapore?
A: No, for private properties you typically need at least 25% downpayment (5% cash, 20% CPF/cash).