Less than 10% loans over limit

FINANCIAL institutions in Singapore have remained prudent in giving out housing loans.

Currently, less than 10 per cent of housing loans are granted at over the 80 per cent limit, ‘although there are signs that more housing loans are originating at higher loan-to-value bands’, said a government statement on Friday.

In a further bid to temper exuberance in the private residential market, the Government will, from Saturday, cap all housing loans at 80 per cent of the total purchase price, from the current 80 per cent limit.

The lower cap will apply to all housing loans given by financial institutions regulated by the Monetary Authority of Singapore.

‘In line with the objective of ensuring a stable and sustainable property market, lowering the LTV limit sends a clear signal to the financial institutions to maintain credit standards, and encourages greater financial prudence among property purchasers,’ said a Government statement on Friday.

Source : Straits Times – 19 Feb 2010