Repay loan on a HDB flat

Hi Mr Tan,

I've been reading your blog for a few weeks now. I really appreciate that you're sharing your experience.

My father bought a 5 room flat about 10 years ago for over $500k. It is probably worth 300k+ today. He has difficulty to pay the loan. It will take another 25 years to pay off the outstanding loan.

I'm about to graduate from the university. Is there anything I can do to help the situation? We have a few tenants. I'm thinking about moving to a 3 room flat to reduce the loan quantum.

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REPLY:

If your family can afford the repayment, it is better to keep the current flat. If your loan is with HDB, your pay interest at a very low rate.

With the current boom in the property market, there is a chance that the value of the HDB flat can recover. You can sell it later, when the price has recovered.

As you are renting out some rooms, it should give you a good rental to help with the repayment.