With the recent cooling measures implemented 05 July 2018, some home buyers are still unsure how they are affected. Let me cover on the TDSR(Total Debt Servicing Ratio) & LTV(Loan To Value). TDSR (TOTAL DEBT SERVICING RATIO): Employed – you will be subjected to 60% TDSR. Which will suggest that you can only use 60% of your monthly gross income for all your outstanding debts. Example: Age: 40 Monthly Gross: $10,000 60% TDSR will be $6,000 to service all your outstanding debts Outstanding debts: Car loan: $1200 Credit Card: $200 (in terms of estimated min payment) Total amount you can use to finance your monthly mortgage repayment= $6,000 – $1,200 – $400 = $4,400 With that, we can work backwards on the estimated housing loan that you are eligible for. Estimated loan amount eligible over 24 years = $855,000 Self-employed – your pay will be subjected to a hair cut of 70%, follow by 60% TDSR. Which will suggest that you can only use 60% of your monthly gross income for all your outstanding debts. Example: Age: 40 Monthly Gross: $10,000 Balance after haircut of 70%: $7,000 60% TDSR will be $4,200 to service all your outstanding debts Outstanding debts: Car loan: $1200 Credit Card: $200 (in terms of estimated min payment) Total amount you can use to finance your monthly mortgage repayment= $4,200 – $1,200 – $400 = $2,800 With that, we can work backwards on the estimated housing loan that you are eligible for. Estimated loan amount eligible over 24 years = $550,000 LTV (LOAN TO VALUE): With the new cooling measures, the LTV had been revised as follows: 1st Property Loan: 75% 2nd Property Loan: 45% 3rd Property Loan onwards: 35% *above are base on loan tenure of up to borrow’s age of 65 years old. What does it mean to be 75% LTV? Example as follows: Purchase price: $1,000,000 Down payment: 25% = $250,000 (Min 5% cash, 20% cpf) Max Loan: 75% = $750,000 Est monthly mortgage repayment: $3,281 over 24 years at 2% interest