Property
TDSR vs MSR explained: how Singapore limits your home loan
Two ratios decide how much a Singapore buyer can borrow. Here is what each one does, in plain words.
TDSR: all your debts
The Total Debt Servicing Ratio limits all your monthly debt payments, including the new home loan, to 55% of gross monthly income. It applies to every property loan from a bank, for HDB flats, ECs and private homes. Car loans, personal loans and card minimums all count.
MSR: the home loan alone
The Mortgage Servicing Ratio limits the home loan instalment alone to 30% of gross income. It applies to HDB flats (HDB loan or bank loan) and to ECs bought from the developer. Private property has no MSR.
The stress-test rate
Both ratios are worked out at a rate higher than you will actually pay: at least 4% for bank loans and at least 3% for HDB loans. This makes sure you can still pay if rates rise.
Which one limits you?
For an HDB flat, MSR usually bites first: 30% is lower than 55%. For private property, only TDSR applies, so other debts matter more. Example: a couple earning S$12,000 with no other debts, buying a condo with a 30-year bank loan, can borrow up to about S$1,382,444 (55% × S$12,000 at 4%). If they had a S$1,000 car loan, that limit would drop by about S$209,461.
Limit is not comfort
The ratios are ceilings. A loan near the limit leaves little room for children, parents, savings or a job change. Many planners suggest keeping the instalment near 25% of income. Check both numbers in the affordability calculator.
Common questions
Is CPF counted as income for TDSR?
Gross income before CPF deductions is used. CPF you use for the instalment does not reduce the ratio.
Does TDSR apply to HDB loans?
HDB loans are assessed on MSR at 30% by HDB. TDSR applies to bank loans.
Figures as of . By Jaimes Tan (陳衍通). For information only; not financial, property or legal advice.