How Much Loan Can I Get from a Bank in Singapore?

Alevin Chan

Alevin Chan

Last updated 30 April, 2024

There are several types of bank loans available, from personal loans to home mortgages, with each offering different maximum loan amounts. Find out how much you can get from different bank loans.

When choosing a bank loan, one of the most important considerations is how much you can actually borrow. Ideally, you’d want a loan that can provide the amount you need. 

How much you can borrow depends on several factors, including your salary, how indebted you are, and what type of loan you are taking. Let’s take a look at each of these in turn, as well as other essential information you need to know. 

Table of contents:


How much loan can I get from a bank?

Here’s an overview of the different types of loans offered by banks in Singapore, and the maximum loan amount for each set by the authorities. 

Type of bank loan

Maximum loan amount

MAS borrowing limits

Personal loan

Annual income less than S$120,000: 4x monthly salary


Annual income S$120,000 and above: 8x to 10x monthly salary 

TDSR

Education loan 

Up to 8x or 10x monthly salary, or up to S$150,000 to S$200,000, whichever is lower

TDSR

Renovation loan

S$30,000 or 6x monthly salary, whichever is lower

TDSR

Car loan

60% or 70% of vehicle purchase price 

TDSR

Home mortgage

75% of property purchase price

MSR & TDSR

As you can see, the maximum loan you can borrow is mainly influenced by your income and the purpose of your loan. In addition, you will also need to pay attention to your Monetary Authority of Singapore (MAS) borrowing limits – Total Debt Servicing Ratio (TDSR) and Mortgage Servicing Ratio (MSR).

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Understanding MAS borrowing limits: Total Debt Servicing Ratio (TDSR) and Mortgage Servicing Ratio (MSR)

Before we give into the different loan types, it’s important to first understand the MSR and the TDSR. These borrowing limits apply to all bank loans, and are meant to prevent borrowers from taking on too much debt. 

Total Debt Servicing Ratio (TDSR)

The total amount of debt repayment each month cannot exceed 55% of your gross monthly income. This includes all forms of debt, including:

  • Home loan
  • Car loan
  • Education loan
  • Personal loan
  • Credit card loan
  • Renovation loan
  • Student loan
  • Any and all unsecured loans, including revolving loans 

If you try to take a loan that would cause your TDSR to be exceeded, your lender is not allowed to approve your loan. You will have to repay some of your existing loans first before borrowing, or increase your income to increase your quota. 

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Mortgage Servicing Ratio (MSR) 

The MSR pertains only to housing property purchases. Specifically, MSR applies to housing loans for the purchase of an HDB flat, or an executive condominium (EC) where the minimum occupation period of the executive condominium has not expired.

The MSR is set at 30% of gross monthly income. This means that the total amount each month that goes towards repaying all property loans cannot exceed 30% of your gross monthly income. 

Importantly, note that MSR is counted under TDSR. This means that if your existing debts (without a home mortgage) already take up 40% of your TDSR, your monthly mortgage payments cannot exceed 15% of your gross income. This would severely curtail the size of your property loan. 

For this reason, borrowers need to watch their overall levels of debt, as they may not always have the full 30% quota available when purchasing an HDB flat or EC.

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How much loan can I get from the bank for a property purchase?

Unless you’re fortunate enough to inherit a property, you’ll likely need to take on a mortgage loan at some point in your life. Because shelter is an essential, lifelong need, housing expenses will naturally be a core item in your budget. This makes a home mortgage one of the most important loans you’ll ever manage. 

The two factors limiting how much you can loan for a property purchase are Mortgage Servicing Ratio (MSR) and Loan-to-Value Ratio (LTV).

Mortgage Servicing Ratio (MSR) and property loans

As explained above, MSR is capped at 30% of your gross monthly income. Thus, if you already have existing property loan repayments that take up, say, 20% of your gross monthly income, your subsequent home loan will reduced 

Since the MSR is based on your gross income, one way to increase how much you can borrow for property purchases is to increase your earnings. This will enlarge your borrowing limit in dollar terms. 

Otherwise, you will have to pay off or refinance your existing property loan to create more room in your MSR for a second mortgage. 

Loan-to-Value Ratio (LTV) and property loans

When taking a home mortgage, you cannot borrow the entire cost of your property. Instead, you will be subject to the Loan-to-Value Ratio (LTV), which varies according to different circumstances. 

Outstanding housing loans

LTV limit 

Minimum cash downpayment

0

75% or 55%

5% (for LTV of 75%)

10% (for LTV of 55%)

1

45% or 25%

25%

2 or more

35% or 15%

25%

The lower LTV applies when 

  • the loan tenure exceeds 30 years (or 25 years for HDB flats), or,
  • when the loan period extends beyond the borrower’s age of 65 years

Note also that when applying for a mortgage, you also have to make a cash down payment. This ranges from 5% to 25% of the property’s purchase price. 

How does MSR work with LTV?

Simply put, MSR serves to ensure homeowners choose an affordable housing option, instead of overspending on a property that is too expensive and getting into financial distress because of it. 

MSR first sets the stage by preventing you from taking on a mortgage that is beyond your means. Next, the LTV further fosters home affordability by requiring you to pay at least 25% of your property’s price upfront. This helps to control your monthly mortgage amount. 

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Maximum loan amount for other types of bank loans

Personal loan – up to 10x monthly income 

How much loan you can get in a personal loan depends on your income level. 

Provided you meet the minimum income requirements (S$20,000 to S$30,000 per annum), you will be able to borrow up to 4x your monthly salary.

However, if your income exceeds S$120,000 per year, you can borrow a much larger sum, up to 8x or 10x your monthly salary. This is up to the discretion of the bank. 

Education loan – up to 10x monthly income, or S$200,000

Education loans require two co-signers, the applicant, and a guarantor who fulfils certain eligibility criteria. 

The maximum amount in an education loan varies depending on which bank you go to. Generally, it ranges from 8x to 10x of the guarantor’s monthly income, or S$150,000 to S$200,000 – whichever is lower. 

Renovation loan – up to 6x monthly income, or S$30,000

A renovation loan from a bank can only be used to pay for approved renovation works. It cannot be used to pay for furniture and appliances, making it less flexible than a personal loan. 

Renovation loans allow you to borrow up to 6x your monthly income. However, the maximum amount is capped at S$30,000 per loan. 

Car loan – up to 70% of purchase price

For car loans in Singapore, the maximum you can borrow is either 60% or 70% of  LTV. This is, in turn, determined by the Open Market Value (OMV) of the vehicle.

OMV of motor vehicle

Maximum LTV

S$20,000 or less

70% 

More than S$20,000

60%

This means that cars with higher value would need a larger downpayment. This is ultimately a good thing, as the larger sum borrowed, the more interest you pay in total. Thus, paying a higher downpayment of 40% upfront helps to lower your monthly car instalments. 

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Frequently Asked Questions (FAQs)

Q: What’s the maximum loan you can get from a bank?

The maximum loan you can get from a bank depends on factors such as income level and whether you have existing loans. Different loan types also have different borrowing limits. 

In general personal loans allow up to 4x your monthly income; renovation loans allow up to 5x monthly income, capped at S$30,000; education loans allow up to 10x monthly income or up to S200,000, whichever is lower. Car mortgages allow up to 70% of the purchase price, and housing loans, up to 75%.

Notwithstanding, all loans are subject to MAS borrowing limits of TDSR and MSR. If your loan would cause your borrowing limits to be exceeded, it will not be granted.  

 

Q: What’s the easiest loan to get approved for?

Personal loans are among the easiest loans to get approved for, especially if you have an existing credit card account that is in good standing. 

You will likely be able to take out a personal loan against your pre-approved credit limit, and your loan may be approved and granted in as quick as one business day. 


Read these next:

This Is How Much You Can Borrow From Different Loans In Singapore

An ex-Financial Planner with a curiosity about what makes people tick, Alevin’s mission is to help readers understand the psychology of money. He’s also on an ongoing quest to optimise happiness and enjoyment in his life.

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Use a personal loan to consolidate your outstanding debt at a lower interest rate!

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