Property
HDB loan vs bank loan in 2026: which should you choose?
For an HDB flat, you can borrow from HDB or from a bank. The cheaper rate today is only part of the answer.
Side by side
| HDB loan | Bank loan | |
|---|---|---|
| Interest | 2.6% a year, stable | Market rate; often fixed 2 to 3 years, then floating |
| Loan-to-value | Up to 75% | Up to 75% |
| Minimum cash | None, all CPF possible | 5% of price |
| Tenure | Up to 25 years | Up to 30 years |
| Income ceiling | Yes, plus other eligibility rules | No HDB income ceiling |
| Switch later | Can refinance to a bank | Cannot switch back to HDB |
| Late payment | HDB is generally more flexible | Bank terms apply |
Cost comparison
On a S$500,000 loan over 25 years, 2.6% costs S$2,268 a month and 3.0% costs S$2,371. That is about S$30,813 more interest over the loan. When bank rates fall well below 2.6%, a bank loan can be cheaper for a while, but rates can rise again.
Who each suits
- HDB loan: buyers who want a stable instalment, no cash downpayment, and flexibility if income dips.
- Bank loan: buyers above the HDB income ceiling, or who are comfortable managing rate changes and can refinance every few years.
Before you decide
Get an HDB Loan Eligibility (HLE) letter or a bank in-principle approval before you sign an option to purchase. Then compare the two loans and stress-test the bank rate.
Common questions
Can I take an HDB loan for a resale flat?
Yes, if you meet HDB’s eligibility conditions, including the income ceiling and the property ownership rules.
Why is a bank loan 5% cash?
For bank loans, MAS rules require at least 5% of the price in cash when you have no other housing loan.
Figures as of . By Jaimes Tan (陳衍通). For information only; not financial, property or legal advice.