Regulatory Alerts2021-06-28
Added · Updated
Notice 1115 Computation of Total Debt Servicing Ratio for Property Loans
Merchant Banks in Singapore must compute the total debt servicing ratio for borrowers applying for credit facilities or re-financing facilities for property purchases, using a formula based on monthly total debt obligations and gross monthly income. The notice defines specific terms such as Borrower, Property, and Relevant Credit Facility, and outlines exceptions where the ratio calculation is not required, such as for certain refinancing scenarios involving capital repayments or debt reduction plans. It also prohibits granting facilities for HDB Flats or Executive Condominiums within their minimum occupation period if the aggregate monthly repayment instalments exceed specified thresholds.
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