Hypothetical example

[yowetan]

Hi all... I will like to check if the following proposition is workable? Please do correct me if my hypothetical assumption and approach is wrong? (Minus away family, ethical values)

Let's us look at this example in financial protocol:

1) HDB Flat in Tiong Bahru 5 room High Floor, near to MRT selling - 1 mil SGD. (Valuation @ 1mil - assumption)

2) Transfer property to wife's name ONLY and removing my name or vice versa - Lawyer Fees = 5kSGD, and Stamp Duty (500k*3%-5400).

3) Next, ask my wife to loan the remaining half value of 500k (1mil SGD valuation price) I will recieve 500k SGD with a portion going back to my CPF OA.

4) Violia! I am one with zero loan and owner - Eligible for 80% loan with no 7% ABSD.

5) I will then activated this 500k SGD (Cash+OA), together with loan 80% to buy a second property (ideally at 1.8mil @ Mt Sinai). Sole ownership.

6) 80% of 1.8mil SGD = 1.4mil SGD loan @ 30 years

7) 20% downpayment = 360k SGD

8) Stamp duty = 50k SGD (Inclusive of stamp duty 500SGD)

9) Lawyer fees = 5k SGD

10) Total cost = 360k+49k+5k = 415k SGD

11) Balanced (500k -415k) = 85k SGD

12) 85K can be keep or used to repay my wife loan on Tiong Bahru HDB.

13) Current Tiong Bahru outstanding loan = 450K SGD approximately.

14) Potential loan taken by wife = 450k + 500k = 950kSGD.

15) Wife will pay 30 years loan for 950k for Tiong Bahru HDB 5 room.

As above proposition, is it possible technically and if it will create any backlash and liabilities?

Please kindly throw in your thoughts, opinions and views.

Please refrain from flaming if possible.

Thanks.

[狮子王]

Your liabilities as a whole has ballooned.

1) Your wife: 950,000

2) You loan 80%, so 500,000 is 20%. Therefore your liabilities is: 2,000,000

Total liabilities : Approx S$3,000,000



I count like this better than your banker or not?

WOAHAHHEHEHEHEHHEHEh

[狮子王]

Your liabilities as a whole has ballooned.

1) Your wife: 950,000

2) You loan 80%, so 500,000 is 20%. Therefore your liabilities is: 2,000,000

Total liabilities : Approx S$3,000,000



I count like this better than your banker or not?

WOAHAHHEHEHEHEHHEHEh

Your liailities is catching up mine if you implement this plan.

WOAAHHHEHEHEHEHEHHEHE

[yowetan]

Your liabilities as a whole has ballooned.

1) Your wife: 950,000

2) You loan 80%, so 500,000 is 20%. Therefore your liabilities is: 2,000,000

Total liabilities : Approx S$3,000,000



I count like this better than your banker or not?

WOAHAHHEHEHEHEHHEHEh

Hi...what if it's only 1.8mil SGD development in Mt Sinai; with reference to my first post's example. I be loaning around 1.4 mil SGD.

So, how do you calculate to 3 mil SGD then? Please kindly enlighten me. TIA.

[DC33_2008]

You have to ask yourself if it is a good debt or bad debt. For example a car could a liablity as it is a bad debt to many people.

[yowetan]

You have to ask yourself if it is a good debt or bad debt. For example a car could a liablity as it is a bad debt to many people.

Hi...it is supposedly a good debt, but I would need more balanced views and opinions to assess if this plan is feasible and justifiable.

[狮子王]

In Hong Kong and Shanghai, the yearly mortgage liabilities is 50x the average salary of a professional which is about US$10,000.

So, I expect them to pay like US$500,000 worth of liabilities .

Your liabilities is S$3,000,000

I do not have data on Singapore. But assuming that I can extrapolate the above concept.

You should have household income of around S$3,000,000 /50 = S$60,000. Are you and your wife earning that kind of salary ?

[yowetan]

In Hong Kong and Shanghai, the yearly mortgage liabilities is 50x the average salary of a professional which is about US$10,000.

So, I expect them to pay like US$500,000 worth of liabilities .

Your liabilities is S$3,000,000

I do not have data on Singapore. But assuming that I can extrapolate the above concept.

You should have household income of around S$3,000,000 /50 = S$60,000. Are you and your wife earning that kind of salary ?

Hi...Our combined household income is around 7.5K++ SGD.

Could you share with me how do you calculate 3 Mil SGD liability, I do not understand this mathematical portion.

[radha08]

hdb can u suka suka transfer to ur wife ah

[lot286]

what is your monthly salary or combined with your wife?

this is overleveraging. one policy change by the government or mortgage rate measures you'll be wiped out

[狮子王]

Hi...what if it's only 1.8mil SGD development in Mt Sinai; with reference to my first post's example. I be loaning around 1.4 mil SGD.

So, how do you calculate to 3 mil SGD then? Please kindly enlighten me. TIA.

I thought you say you paid $500,000 downpayment. So that is 20% =S$500,000 since you taking 80% loan? Maybe I misunderstood your information.

If not,

20% =500,000
20%= 500,000
20% =500,000
20%= 500,000
20% =500,000

============

100% = 2,500,000
less downpayment 500,000

Your loan: 2,000,000
Your wife loan : 950,000

====================

Total : 2,950,000


WOAHAHHEHEHHEHEHEHEHEHEH

[狮子王]

Hi...Our combined household income is around 7.5K++ SGD.

Could you share with me how do you calculate 3 Mil SGD liability, I do not understand this mathematical portion.

Read my post above.

[yowetan]

hdb can u suka suka transfer to ur wife ah

Hi radha08...I am unsure if it can work. Hence, I am listing out a hypothetical example to squeeze more money for the Mt Sinai development.

[狮子王]

Hi all... I will like to check if the following proposition is workable? Please do correct me if my hypothetical assumption and approach is wrong? (Minus away family, ethical values)

5) I will then activated this 500k SGD (Cash+OA), together with loan 80% to buy a second property (ideally at 1.8mil @ Mt Sinai). Sole ownership.


Thanks.

I thought you say you paid $500,000 downpayment. So that is 20% =S$500,000 since you taking 80% loan? Maybe I misunderstood your information.

If not,

20% =500,000
20%= 500,000
20% =500,000
20%= 500,000
20% =500,000

============

100% = 2,500,000
less downpayment 500,000

Your loan: 2,000,000
Your wife loan : 950,000

====================

Total : 2,950,000

[yowetan]

Read my post above.

Hi... Thanks for the clearer explanation.

Ok, let's set the record right. What if:

1. wife total loan = 950k SGD for Tiong Bahru HDB 5 room Flat
2. Mine total loan = 1.4mil SGD for Mt Sinai 2 bedder

Both at 30 years loan.

We will have around 80kSGD cash/CPF fund on hand.

This is accordance to my first post's example.

How will this scenario paint out? TIA again.

[狮子王]

Your liabilities as a whole has ballooned also if your loan is not 2,000,000 but 1,400,000.

1) Your wife: 950,000

2) You loan : 1,400,000

Total liabilities : Approx S$2,350,000

In Hong Kong and Shanghai, the yearly mortgage liabilities is 50x the average salary of a professional which is about US$10,000.

So, I expect them to pay like US$500,000 worth of liabilities .

Your liabilities is S$2,350,000

I do not have data on Singapore. But assuming that I can extrapolate the above concept.

You should have household income of around S$2,350,000 /50 = S$47,000. Are you and your wife earning that kind of salary ?

[狮子王]

Hi... Thanks for the clearer explanation.

Ok, let's set the record right. What if:

1. wife total loan = 950k SGD for Tiong Bahru HDB 5 room Flat
2. Mine total loan = 1.4mil SGD for Mt Sinai 2 bedder

Both at 30 years loan.

We will have around 80kSGD cash/CPF fund on hand.

This is accordance to my first post's example.

How will this scenario paint out? TIA again.

Read my above post. You have to try to lower your liabilities by buying a less expensive home or just keep to only one home both as own stay and investment.

Otherwise, make sure your monthly household income can hit S$40,000 soon.

[狮子王]

Maybe other brothers and sisters have better suggestion? Let's wait for their replies

[Tan80000]

HDB how to tranfer to only one name??

[yowetan]

Your liabilities as a whole has ballooned also if your loan is not 2,000,000 but 1,400,000.

1) Your wife: 950,000

2) You loan : 1,400,000

Total liabilities : Approx S$2,350,000

In Hong Kong and Shanghai, the yearly mortgage liabilities is 50x the average salary of a professional which is about US$10,000.

So, I expect them to pay like US$500,000 worth of liabilities .

Your liabilities is S$2,350,000

I do not have data on Singapore. But assuming that I can extrapolate the above concept.

You should have household income of around S$2,350,000 /50 = S$47,000. Are you and your wife earning that kind of salary ?

Hi...based on your repeated emphasize on the mortgage liabilities index of 50x.

This is critical?

If I lower to 1.5mil SGD property development. 80% of the loan will be:

1) Mt Sinai very old property loan 80% = 1.2 mil SGD.
2) Wife's HDB loan = 950kSGD.
3) As I mentioned, I will have 500kSGD (OA+Cash from my wife's shares transfer). I will have a surplus of 200kSGD approximately after paying off the 20% downpayment.
4) I could potentially lower my wife's liability to 750kSGD.

Total will be 1.2Mil + 750kSGD = 1.95 Mil SGD.

Will this formulae and methodology works if I keep "downsizing" my property purchase etc?

TIA again, and again.

[yowetan]

HDB how to tranfer to only one name??

Hi...Is it not possible?

[狮子王]

Hi...based on your repeated emphasize on the mortgage liabilities index of 50x.

This is critical?

If I lower to 1.5mil SGD property development. 80% of the loan will be:

.....

TIA again, and again.

After analysing your information & method; from my gut feeling, you have no intention to hold the properties for long term, am I correct to say that?

The main subject of this method is that you have just ballooned your wife's liabilities to nearly S$1million.

[yowetan]

After analysing your information & method; from my gut feeling, you have no intention to hold the properties for long term, am I correct to say that?

Mt Sinai would probably be the final one - I need to house all my family members and enrol my boys into Henry Park Primary.

I may or may not dispose Tiong Bahru HDB 5 room flat, depending on the outlook of the economy and the emigration policy from the MOM/Government.

I am trying to maximise what I can in anticipation of low interest rate and hot money flow globally.

Please advise if my methodology is workable or not? TIA.

[狮子王]

After analysing your information & method; from my gut feeling, you have no intention to hold the properties for long term, am I correct to say that?

The main subject of this method is that you have just ballooned your wife's liabilities to nearly S$1million.

I see either a very ambitious person or a very greedy one.


WOWHAAHAHHEHHEHEHEHHEHEH

[狮子王]

Mt Sinai would probably be the final one - I need to house all my family members and enrol my boys into Henry Park Primary.

I may or may not dispose Tiong Bahru HDB 5 room flat, depending on the outlook of the economy and the emigration policy from the MOM/Government.

I am trying to maximise what I can in anticipation of low interest rate and hot money flow globally.

Please advise if my methodology is workable or not? TIA.

I let the other wiser brothers advise you. For me, I think you are taking a big risk because of your income; unless you have other real assets like stocks or gold?

Most young people at your income level would be contented at a new HDB in Pasir Ris or maybe an EC.

[yowetan]

I let the other wiser brothers advise you. For me, I think you are taking a big risk because of your income; unless you have other real assets like stocks or gold?

Most young people at your income would be contented at a new HDB in Pasir Ris.

My wife and myself are already 36 year old, and we are trying ways to help ourselves and our children.

We only have around 50kSGD from our parents and in-laws disposal rental income.

[myfirstpc]

Mt Sinai would probably be the final one - I need to house all my family members and enrol my boys into Henry Park Primary.

I may or may not dispose Tiong Bahru HDB 5 room flat, depending on the outlook of the economy and the emigration policy from the MOM/Government.

I am trying to maximise what I can in anticipation of low interest rate and hot money flow globally.

Please advise if my methodology is workable or not? TIA.

Low interest rates will not last for 30yrs, which is your planned loan period.
Your current income will limit your loan amount.
Any upswing in interests rates, you will have no buffer.
Any health issues, though you may take up mortgage protection plan MPP for both wife and husband as both are stucked with liabilities, it does not come cheap in order to protect the asset. (based on your age, up to 5K annually per pax in premiums for the MPP)
Do you have buffer for 1-2 yr of loan repayments (both spouse and you) ?
Do you have millionaire relatives to turn to?
Your proposed route attracts unacceptable risks.

[yowetan]

Low interest rates will not last for 30yrs, which is your planned loan period.
Your current income will limit your loan amount.
Any upswing in interests rates, you will have no buffer.
Any health issues, though you may take up mortgage protection plan MPP for both wife and husband as both are stucked with liabilities, it does not come cheap in order to protect the asset. (based on your age, up to 5K annually per pax in premiums for the MPP)
Do you have buffer for 1-2 yr of loan repayments (both spouse and you) ?
Do you have millionaire relatives to turn to?
Your proposed route attracts unacceptable risks.

Assuming if I dispose my parents/in-law's HDB and have a disposal cash amount to 300kSGD. (I will not touch and instead place it in the bank or stocks etc)

Would it migitate and helps in the methodology approach?

[phantom_opera]

I already told yowetan the only way out is to sell parents + PILs HDBs

[yowetan]

I already told yowetan the only way out is to sell parents + PILs HDBs

Hi...what if I still want to keep all three HDBs, but taking the proposed route which stated in my first post in this thread.

Will it be feasible, as long I am keeping the development value low i.e. 1.5mil SGD and below?

Your input is appreciated.