MAS irons out refinancing rules under TDSR

It added to exemptions made in 2014.

Singapore’s central bank aims to straighten out the refinancing rules under its Total Debt Servicing Ratio to ensure that borrowers for owner-occupied properties bought after the TDSR would now be exempt from the framework when refinancing the loan.

According to a report by OCBC, under the previous set of rules, the exemption only applied to owner-occupied residential properties bought before the TDSR was implemented.

For investment properties, OCBC added that borrowers will also be exempt from the TDSR framework if they commit to a debt plan with his financial institution to repay at least 3% of the outstanding loan balance over a period of not more than three years.

Additionally, they should also fulfill their financial institution’s credit assessment, OCBC said.

“Similarly, the exemption from TSDR requirements only previously applied to investment properties bought before TDSR was introduced. These new rules will take immediate effect,” the report added.