Applications from Self-employed Persons for Housing Loans from HDB and Financial Institutions

Ms See Jinli Jean asked the Minister for National Development (a) for each year in the last five years, how many self-employed persons applied for housing loans from (i) HDB and (ii) financial institutions respectively; (b) of which, yearly, how many failed in their housing loan applications because they exceeded the (i) Mortgage Servicing Ratio for HDB and (ii) Total Debt Servicing Ratio for financial institutions; and (c) in the breakdown, how many of these self-employed persons are platform workers.

In assessing applications for a Housing and Development Board (HDB) housing loan, HDB considers various factors, such as job stability, CPF contributions and monthly cash savings. In computing the eligible loan amount, HDB applies a set of mortgage financing guidelines, such as a maximum loan tenure of 25 years, loan-to-value limit of 80%, maximum Mortgage Servicing Ratio (MSR) of 30%, and interest rate floor of 3% per annum to ensure prudent borrowing. HDB does not reject housing loan applications based on whether the applicant’s MSR exceeds a particular threshold.

The number of Self-Employed Persons (SEPs) who applied for HDB housing loans in the last five years is summarised in Table 1 below.

HDB does not have further breakdown on whether these SEPs are platform workers or not. The Government does not collect housing loan data from financial institutions on SEPs as requested by the Member.