A new HDB rule that came into effect on Jan 1 this year required all potential flat buyers and transferees who intend to get an HDB concessionary loan to first obtain an HDB Loan Eligibility (HLE) letter before exercising an Option to Purchase a new flat from the HDB, a resale flat or when applying to take over ownership of an existing flat.
Buyers need to have this letter indicating the maximum amount they can borrow, the repayment period, and monthly instalments payable, before committing to the purchase.
The additional procedure is aimed at helping house-hunters better understand their financial situation before buying a flat. They would then know what type of flats they can afford and not fall into the financial trap of buying a home without knowing whether they can afford it.
Applying for the letter has to be done online. If you don’t have Internet access at home, you can use the use the self-service kiosk at the HDB Hub or the Internet PCs at any HDB Branch Office to submit your application.
After submitting the application, you need to print out the form and sign it, gather the required supporting documents, and send it all to the HDB within seven days of the date of application.
Buyers taking up a bank loan to finance the flat need a Letter of Offer from the banks indicating a loan offer before they can exercise the Option to Purchase. Buyers paying with cash and/or their Central Provident Fund savings will need to show documents such as bank statements and CPF statements to prove they have enough money.
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