Find out more about Renovation Loans

When you have purchased a house, it might be an uncompleted property, an old completed property or just a property you might want to “revamp” before moving in.

Not everyone can afford to pay up in cash for their renovation, thus there are banks and/or financial institutions that provide renovation loans.

Here are some pointers to take note of before taking up a renovation loan:

Eligibility

- Singapore Citizen or Permanent Resident between 21 and 55 years of age.

- Annual income must be at least S$24,000 for main applicant.

- Joint applicants are not required to meet the minimum income criteria

- Joint applicants other than the legal owners must be related as a spouse, parent, sibling, or child (proof of relationship is required)

Banks like RHB and Maybank are quite popular in the renovation loans thanks to their competitive rates. For more details, do click on the renovation loan wizard tool.

For most cases, the bank may at its sole discretion extend a loan up to 6 times the individual or combined applicant(s) monthly income. Usually, the maximum loan amount for renovation loans is S$300,000 and the minimum would be S$100,000.  The maximum loan tenure for renovation loan is typically up to 5 years.

When you take up the loan from a bank, the bank may have to visit the site for verification of renovation works.

Also, do take note of the processing fee which is usually 0.1% of the loan amount, that has to be paid upfront upon signing the Letter Of Offer in acceptance of the approved loan from the bank.

Other points to bear in mind, just like taking up a home loan, would be the cancellation fee or administrative fee (if loan is prepaid within the loan tenure).