How much bank loan can I get with a freelance income of $7,000?

To determine how much bank loan you can get for a property in Singapore, several factors need to be considered, including your income, debt obligations, and the specific regulations set by the Monetary Authority of Singapore (MAS).

Income and Debt Servicing Ratios

• Your monthly gross income is $7,000. However, the key ratios to consider are the Total Debt Servicing Ratio (TDSR) and, if you are buying an HDB flat, the Mortgage Servicing Ratio (MSR).
• TDSR is capped at 55% of your gross monthly income. This means that all your monthly debt obligations, including the proposed mortgage, car loans, personal loans, and other debts, cannot exceed 55% of your $7,000 income.
• MSR, applicable for HDB flats and executive condominiums, is capped at 30% of your gross monthly income.

Loan Eligibility

• Assuming you have no other significant debt obligations, you can calculate the maximum mortgage payment you can afford.
  • For TDSR: 55% of $7,000 = $3,850 per month.
  • For MSR (if applicable): 30% of $7,000 = $2,100 per month.

Loan Amount

• The loan amount you can secure will depend on the loan tenure and interest rate. Generally, the maximum loan tenure for HDB flats is 25 years, and for private properties, it is 30 years, or up to the age of 65, whichever is lower.
• Using EdgeProp's affordability calculator, you can input your income, desired loan tenure, and interest rate to estimate the maximum loan amount you can borrow.

Loan to Value (LTV) Ratio

• For bank loans, the LTV ratio is capped at 75% of the purchase price or the property's valuation, whichever is lower. This means you would need to pay at least 25% of the purchase price as a down payment.

To get a precise estimate, it is advisable to use EdgeProp's affordability calculator or consult with a mortgage advisor who can provide a detailed assessment based on your specific financial situation and the current market conditions.