Property News · April 21, 2020

Over 17,000 bank customers seek to defer mortgage payments


Singapore saw more than 17,000 bank consumers applying for a deferment of their mortgage repayments, reported The Business Times.
The figure, which was collated across seven major retail banks, represents around 3% of total mortgage loans here and about 2% of households with outstanding home loans.
At least 3,000 customers also applied for conversions of their outstanding balances in personal unsecured credit to term loans at a reduced interest rate, as offered on recent relief measures.
While the figure was not considered high in absolute terms, it shows that a wide spectrum of the households and economy are affected by the Covid-19 outbreak, said observers. In fact, they expect the numbers to increase amid higher job losses and rounds of pay cuts.
“The applications could well double if these (circuit breaker) measures are extended by another two or three months,” said Chua Hak Bin, a Senior Economist at Maybank Kim-Eng.
The Monetary Authority of Singapore (MAS), along with other industry bodies, guided that all banks and finance firms must allow deferments from 6 April to the end of 2020 of either principal repayments or both interest and principal payments of qualifying mortgages. The applicants need not show proof of impact from Covid-19.
This means interest will accrue on the deferred principal amount, although no interest will be imposed on the deferred interest payments.
Related story: Covid-19 Home Loan Deferment: What Is It, What’s the Catch and How Do I Apply for It?
With requests “steadily coming in”, OCBC received over 3,000 applications for deferment of residential property loans. It has approved more than 90% of eligible applications.
“People who have, as a result, lost their jobs or have had their pay cut will appreciate any help they can get to ease their pressing cashflow needs,” said Sunny Quek, Head of Consumer Financial Services at OCBC.
UOB recorded almost 4,500 applications and DBS posted over 8,000 deferral requests as of 14 April.
DBS revealed that the figure is a big jump from the 900 applications for a six-month principal repayment moratorium for mortgage loans on 3 April.
Maybank shared it received around 2,000 applications for a mortgage moratorium. Citibank, Standard Chartered and HSBC declined to give the exact numbers, saying only they received a pipeline of enquiries on different relief programmes.
DBS Economist Irvin Seah believe that not all applicants are in dire situation and may “just (be) taking pre-emptive steps to do financial planning”.
“It is good that people are planning ahead and looking at these schemes,” he said. “If people are complacent, the day they are hit with liquidity crunch, individuals file for bankruptcy and businesses go belly up, that will be worse.”
2 in 5 Singaporeans still don’t know that they can refinance their home loans and reduce their monthly repayments: PropertyGuru study
According to PropertyGuru’s Consumer Sentiment Study in 1H2020, 40% of Singaporeans are unaware that they can get better home loan rates from banks via refinancing.
With tough times ahead, this is a good opportunity to get expert help and advice so that you can plan your home loans better. Get in touch with our panel of experts on PropertyGuru Finance now for unbiased and personalised advice, you can also compare all the best home rates under one roof. 
 
 
 
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Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg

Source : proppertyguru.com.sg/Property Market
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