Friday, November 10, 2006
[RealEdge] BT Letters : High time to rethink home loan policies
| Published November 9, 2006  | |
| LETTER TO THE EDITOR | |
| High time to rethink home loan policies I REFER to the articles 'The low down on home loans' (BT, Nov 8), 'Housing policies to be refined' by Uma Shankari (BT, Nov 4) and 'Mortgagee sales of HDB flats on the rise' by Siow Li Sen (BT, Oct 20). The last article said that one bank 'said it has no mortgagee sale so far', while another 'said it has not had many defaults in this area', and that the 'other banks would not tell BT how many repossessed flats they have on their books'. Just four property auction companies have had increasing HDB bank loan foreclosures of about 38 flats a month (456 a year), which is an annual increase of about 690 per cent (456 divided by 190 divided by 3) over the 190 flats foreclosed in the first three years after bank loans started for HDB flats on Jan 1, 2003. After three years and nine months, the default rate of about one per cent is quite high as there are already about 700 foreclosures out of a total of about 70,000 HDB flats with bank loans. On Oct 13, HDB announced a new procedure that from Jan 1 next year, those who want to apply for a housing loan will first need to obtain a loan eligibility letter before they can commit to buying a new flat. How many Singaporeans have to lose their homes and CPF, before we rethink the policy change of giving the first charge on property to banks? As more Singaporeans become ineligible for HDB subsidised loans because they, or jointly with their parents, have used up the two subsidised loans allowed by HDB, there may be more foreclosures as in contrast, HDB was quoted in the subject BT article that they did not repossess any flats in 2004 when only about 10 flat owners gave up their flats on their own accord. Leong Sze Hian |
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