What is the difference between a mortgage loan and a housing loan

In the context of Singapore real estate, the terms "mortgage loan" and "housing loan" are often used interchangeably, but they essentially refer to the same financial product: a loan used to purchase a property.

Key Differences in Context

- Source of Loan: The primary difference lies in the source of the loan. For HDB flats, you can opt for either an HDB loan or a bank loan. For private properties, including landed properties and Executive Condominiums (ECs), you must use a bank loan as HDB does not provide loans for these types of properties.

- Interest Rates and Downpayment:
- HDB Loans: Typically have lower interest rates, currently at 2.60% per annum, and require a 20% downpayment, which can be fully paid using CPF Ordinary Account funds. There is no lock-in period for HDB loans.
- Bank Loans: Generally have higher interest rates, starting from around 2.8% per annum, and require a 25% downpayment, with at least 5% paid in cash. Bank loans often come with lock-in periods and can offer both fixed and floating interest rates.

- Loan-to-Value (LTV) Ratio:
- HDB Loans: Allow you to borrow up to 80% of the property's purchase price.
- Bank Loans: Allow you to borrow up to 75% of the property's purchase price.

Summary

While the terms "mortgage loan" and "housing loan" are synonymous in Singapore, the distinctions come from the type of property being purchased and the loan provider (HDB or bank), each with its own set of conditions, interest rates, and requirements.