Planning to Break-Up After You BTO-ed? You Might Lose up to $37k...
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Planning to Break-Up After You BTO-ed? You Might Lose up to $37k...

Kenneth Fong
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Breakups suck.

But you know what’s worse?

Breaking up when you and your partner have already balloted for an HDB BTO flat.

Sad Finn And Jake In The Rain
Source: Adventure Time | Giphy

Yep.

While I’ve shared my experience with regard to the nuances of getting your BTO, as well as the joys of owning your own home.

I’ve also seen plenty of couples who’ve never seen it through.

So before you pop the question and ask “Ai BTO mai?” (Hokkien: Wanna BTO not?).

Did you know that you could lose anything from $10 to more than $37,000?

Note: the numbers and figures quoted in this article will be based on a 4-room HDB BTO flat from the Tengah November 2019 HDB BTO Launch


TL;DR: What Will I Lose If I Break-Up After I BTO?

Using 4-Room HDB BTO flat price (starts from $302,000) during the Tengah November 2019 HDB BTO Launch

Here’s how much you’ll stand to lose if you break up:

Stage in BTO ApplicationHow Much Will I Lose?
Before Unit Selection$10.00
After Booking A Flat but before signing the Agreement For Lease$2,010.00
After signing The Agreement For Lease but before Key Collection$21,642.79
(and return housing grant + accrued interest)
After Key Collection$37,302.42
(and return housing grant + accrued interest)

But there’s more to it than just financial loss…

You’ll also lose your First-Timer Applicant privileges (such as CPF grant eligibility and priority).

And you’ll even get barred from buying or balloting for another BTO flat for a set number of years.

So think twice before committing!

.

.

.

Need another perspective or some advice on your BTO application?

Don’t paiseh!

Jake Giving Advice
Source: Adventure Time | Giphy

You can always ask the friendly SeedlyCommunity for help before making your decision!


Broken Heart

How Much Money Will I Lose If I BTO and Break Up?

We all know or at least heard of couples who’ve broken up after they’ve applied for a BTO.

And while we kinda know that it’s an emotional and potentially expensive affair.

Most of us don’t know how much we might actually lose if we applied for an HDB BTO and changed our minds.

For this exercise, I’ll be using the following assumptions:

  • You applied for a 4-room BTO HDB flat during the Tengah November 2019 HDB BTO Launch (indicative starting price: $302,000)
  • You’re a First-Timer Applicant
  • Your average monthly household income is $5,000
  • You take a CPF Housing Loan

to give you a better idea of the repercussions when you choose to BTO and break up.

Number One In Green Circle

Cancellation of Flat Application Before Unit Selection

What Do I Lose?What Happens If I Wish To Apply For Another BTO HDB Flat?
BTO Application Fee$10First-timer Applicants: Privilege will be revoked for 1 year if you reject again (you have 2 chances)

First-timer Married Couples (Family Unit): The higher priority accorded due to previous unsuccessful applications will be reset to zero

As a First-Timer Applicant, your housing needs are more pressing.

As a result, you enjoy greater priority when you apply for a new HDB flat.

Here are some of the benefits for couples, with a first-timer applicant, applying for a new BTO HDB flat:

  • A higher proportion of flat supply for first-timers
  • More ballot chances (you get 2 ballot chances)
  • Additional ballot chances for unsuccessful attempts
  • May be eligible for Staggered Downpayment Scheme

If you decide to cancel your application…

Even if you have not been called up HDB to book (or select) a flat.

HDB will consider you as having rejected a chance to select a flat.

This means that if you cancel your application again.

Your First-Timer Applicant privilege will be revoked for one year.

Total Amount Payable

If you’ve changed your mind about applying for an HDB BTO.

Download and complete the Cancellation of Application (before Selection) form for submission.

How much you will lose: $10.00

Number Two In Green Circle

After Booking A Flat But Before Signing The Agreement For Lease

What Do I Lose?What Happens If I Wish To Apply For Another BTO HDB Flat?
BTO Application Fee$10 First-timer Applicants: Additional chances for balloting will be reset to zero

Barred from buying or balloting for another BTO flat for one year
Option Fee$2,000

The option fee varies depending on the flat type that is booked.

Flat TypeOption Fee Payable
2-room Flexi Flat$500
3-room Flat$1,000
4/ 5-room and Executive Flat$2,000

The total amount that you lose isn’t that huge, but it’s no chump change either.

However, the biggest problem is that you’ll not be allowed to apply to buy or ballot for another HDB flat for one year.

Plus, any additional chances accumulated from previous unsuccessful applications will be reset to zero so whatever advantage you garnered initially is lost.

Total Amount Payable

If you’re absolutely sure you want to cancel at this stage.

Download and complete the Cancellation of Flat (before Signing the Agreement for Lease) form for submission.

How much you will lose: $2,010.00

Number Three In Green Circle

After Signing The Agreement For Lease But Before Key Collection

By this stage, the stakes are a little higher.

What Do I Lose?What Happens If I Wish To Apply For Another BTO HDB Flat?
BTO Application Fee$10 First-timer Applicants: Additional chances for balloting will be reset to zero

Barred from buying or balloting for another BTO flat for one year
Option Fee$2,000
Downpayment (5% of property purchase price)$15,100
Buyer's Stamp Duty$4,240
Legal Fees$292.79
Housing Grant(s)$45,000 + accrued interest

Downpayment

Assuming you take an HDB housing loan and you qualify for the Staggered Downpayment Scheme.

You’ll need to put down a 5% downpayment.

That amounts to $15,100 for a 4-room HDB BTO flat with a property price of $302,000.

If you’re taking a bank loan, you would’ve paid 10% or $30,200 as downpayment instead.

Buyer’s Stamp Duty

Using the Inland Revenue Authority of Singapore’s Stamp Duty Calculator, you’ll need to pay $4,240.

P.S. if you’re using HDB’s lawyers, you might be able to get them to apply to IRAS for a refund of your Buyer’s Stamp Duty.

Legal Fees

Legal fees include Conveyancing Fees and Caveat Registration Fees.

Conveyancing fees are calculated:

  • First $30,000: $0.90 per $1,000
  • Next $30,000: $0.72 per $1,000
  • Remaining Amount: $0.60 per $1,000

Note: the minimum conveyancing fee chargeable is $20 and it is subjected to GST.

Based on the HDB Legal Fees Enquiry Calculator, you’ll need to pay $228.34 (inclusive of GST).

The Caveat Registration Fee of $64.45 (inclusive of GST) is payable when you sign the Agreement for Lease.

Housing Grants

Any grants you get, for example, the Enhanced CPF Housing Grant (EHG) would also have to be returned with interest.

Assuming your monthly household income is $5,000.

That means you have to return the disbursed $45,000 plus any accrued interest.

Total Amount Payable

If you die die must break up at this stage

You’ll need to download and complete the Cancellation of Flat (after signing Agreement for Lease) form for submission.

How much you will lose: $21,642.79 (plus must return HDB Housing Grant and accrued interest)

Apart From Money, What Else Do I Lose?

You’ll have to wait 1 year from the date of cancellation before you can apply or be included as an essential occupier for a:

  • New HDB flat
  • DBSS flat from developers
  • EC unit from developers
  • Resale flat with CPF housing grant
  • Resale flat that’s announced for SERS

And if you applied as a first-timer family, any additional chances that you may have accumulated from your previous unsuccessful BTO applications will also be reset to 0.

Oh, after the 1-year wait-out period, the debarment will be lifted and you will be treated as a first-timer.

Since you technically did not enjoy any housing subsidy upon cancelling your HDB BTO flat.

Number Four In Green Circle

After Key Collection

By this point, you’ll need to submit your marriage certificate within three months from your BTO completion date.

You could apply for a deferment, but that’s subjected to HDB’s approval on a case-by-case basis.

After collecting your key, you would have paid the balance of your property’s purchase price using:

  • cash
  • CPF, or
  • bank loan

On top of that, there’s a whole slew of fees and insurance to pay for.

What Do I Lose?What Happens If I Wish To Apply For Another BTO HDB Flat?
BTO Application Fee$10 No First-Timer Applicant privilege

Barred from buying or balloting for another BTO flat for a number of years
Option Fee$2,000
Downpayment (10% of property purchase price)$30,200
Buyer's Stamp Duty$4,240
Legal Fees$292.79
Housing Grant(s)$45,000 + accrued interest
Lease In-Escrow Registration Fee (if HDB acts for you)$38.30
Survey Fee (for 4-room flat)$294.05
Home Protection Scheme$221.34 (annually)
Fire Insurance$5.94

At this stage, you’ll effectively be surrendering possession of your HDB BTO flat.

While HDB might offer you some compensation, that amount will be at their discretion (read: don’t count on it).

And if you’re funding this purchase with a bank loan, you’re going to need a large sum of money to repay the loan.

Registration Fee

There are two types of registration fee:

  • Lease In-Escrow registration fee of $38.30 — if HDB acts for you in the flat purchase
  • Mortgage In-Escrow registration fee of $38.30 — if you take a loan from the bank

Survey Fee

The survey fee varies depending on the flat type.

Flat TypeSurvey Fee (before GST)
1-Room$150
2-Room$150
3-Room$212.50
4-Room$275
5-Room$325
Executive Flat$375

Expect to pay $294.05 (inclusive of GST) for a 4-room flat.

Home Protection Scheme (HPS)

Using CPF’s HPS Premium Calculator, and assuming:

  • You are 30 years old
  • You take up a $267,000 loan amount
  • Your loan is a 25-year tenor

The annual premium payable is $221.34.

Fire Insurance

HDB’s current appointed insurer is FWD Singapore Pte Ltd. Fire Insurance for a 4-room flat will cost you $5.94 (inclusive of GST).

Total Amount Payable

Assuming the worst-case scenario where you don’t get a single cent back from HDB…

How much you will lose: $37,302.42 (plus must return HDB Housing Grant and accrued interest)


Closing Thoughts

The costs calculated here are just estimates and will differ depending on a variety of circumstances.

And all of this is assuming you haven’t gotten married yet.

FYI: I’ve worked out earlier that an average wedding will cost a whooping $27,610!

Costs of Wedding

Can you imagine having to pay for the wedding AND your BTO flat only to call it off?

Ice Cube And Chris Tucker Going Damn
Source: Friday | Giphy

Damn siao please.

There’s always the case for applying for a BTO first since project launches in an area or estate which you want to live in in the future do not come by every quarter.

Well… if your relationship is in a place where you’re serious about each other and have thought about your future together.

Then sure.

Having the “Ai BTO mai?” talk would help bring your relationship to the next level.

But remember to weigh that against the financial implications and repercussions to your eligibility for future BTO projects if your relationship doesn’t weather the application process.

About Kenneth Fong
Owner of a 4-room HDB BTO and married to a financial clutz. Probably the closest to an adult you can find on the Seedly team.
You can contribute your thoughts like Kenneth Fong here.

Still have more questions after reading the article? Fret not, ask our community here!

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