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What is the loan-to-value (LTV) limit
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The loan-to-value (LTV) limit determines the maximum amount an individual can borrow from a financial institution (FI) for a housing loan.
0 Outstanding housing loans:
LTV Limit: 75% or 55%
1 Outstanding housing loans:
LTV Limit: 45% or 25%
2 Outstanding housing loans:
LTV Limit: 35% or 15%
Apply the lower LTV limit if the loan tenure exceeds 30 years, or if the loan period extends beyond the borrower’s age of 65 years.
Calculating Age for Joint Borrowers
For joint borrowers, use their income-weighted average age as their present age.
Example:
Mr. Tan is 60 years old and has a gross monthly income of $8,000. His son Alvin is 30 years old with a gross monthly income of $10,000.
Their income weighted average age is:
(60*$8,000 / ($8,000 + $10,000)) + (30*$10,000 / ($8,000 + $10,000))
= 26.67 + 16.67
= 43.34