Following the article on HDB RFL, Selling, we will discuss the timeline for buying a flat.
This post will provide you with an overview of the purchase timeline. It will help you plan the sale and purchase if you decide to upgrade or downsize.
If you need funds from the sale of your current unit to upgrade or downsize, you must carefully coordinate the sale and purchase timeline to ensure the funds from the sale are available in time for the completion of the purchase.
In this post, I will focus on the purchase timeline. I will discuss the financial calculations in a subsequent post.
Once you have decided to buy an HDB flat, whether a new BTO or resale, you will need to apply for HDB Flat Eligibility (HFE). The process typically takes 28 working days. Once HDB approves your HFE application, you will be eligible to buy an HDB flat. This step is crucial and a prerequisite.
After the HFE has been approved and you know how much loan you can take (figures will be given in the HFE if you apply for an HDB loan), you can work with a banker to get your In-Principle Approval (IPA) if you are taking a bank loan.
Once the HFE and loan approval are done, you can start looking for your preferred unit and follow the steps outlined in the above image.
Below are the key things to look out for during the purchase process:
Indicative value of the property - You can check out HDB website or use the different portal's (SRX, Edgeprop, and even UOB) indicative value as a reference
Will seller need any extension stay? If they do, you may need to plan for alternate accommodation.
Plan for renovation - if you plan for a total revamp of the unit, speak to your contractor and estimate the timeline
Funds from the sale of your unit - If you need these funds, you will need to plan for a back-to-back transaction. If you are on an HDB loan, you can use the Enhance Contra Facility. If you are taking a bank loan, you will need to plan for the CPF fund refunds to complete the purchase.
Plan the timeline for both the sale and purchase in detail. - Draft out both timelines for better clarity, which will help you plan the sale and purchase more effectively.
When doing a back-to-back transaction, the timeline is crucial. - Ensure you have a buyer for your unit before committing to another unit, and vice versa. Do not get caught in a situation where you need to sell your unit at a lower price or give up the unit you had put your option money on.
Feel free to comment below if you have any questions! Stay tune for the financial planning post!
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