What Happens To Your Home Loan In Singapore If Your Spouse Passes Away?
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Ryan J
- January 26, 2025
- 4 min read
4 min read
There are some pretty hair-raising ideas out there, about what happens when one co-borrower passes on.
This was a source of panic for an acquaintance last week, when that exact thing happened. He’d been under the impression that, when the worst happened, he’d simply pay more for the home loan and keep servicing it. The problem is, that it’s not as simple as tightening your belt and preparing to pay more.
The bank still needs to assess whether you’re able to take on the loan. That means going through the usual eligibility checks, including things like the Total Debt Servicing Ratio (TDSR). For those who don’t know, that caps your monthly loan repayment to 55 per cent of your monthly income, inclusive of all other debt obligations.
On top of that, issues such as the remaining loan tenure can be changed, based on the age of the surviving borrower (shorter loan tenure = higher monthly repayments.)
This can get worse if your loan was approved before 2013
Because before that fateful year, there was no TDSR limitation. There is now though; and what that means is that sometimes, you could have qualified for the loan before, but not anymore today. Especially not when there’s one less co-borrower, whose income you can count on.
So even if you can find some way to cough up a few extra thousand a month, that may not matter: if you’re not qualified to take over the loan right away, foreclosure may be on the cards. And quite often, that’s the last thing you want to be dealing with, when you’re already trying to process your grief.
Another homeowner thought life insurance was supposed to “cover this sort of thing.”
Which, based on my conversations with insurance agents, isn’t impossible – but also not advisable. Whether this works is going to come down to how much the late co-borrower was insured for, versus how much your property is worth. If you still owe $1 million+ on the home, and the payout is $300,000, then you still potentially aren’t in the clear.
Plus, it kind of defeats the purpose: who wants to see an entire life insurance payout, meant for the family for decades, evaporate to partially pay off a home loan? Especially at a time when the household income has taken a huge hit.
That’s why sometimes, the sheltering nature of HDB can be a drawback
HDB owners generally don’t worry about this sort of thing. That’s because, for HDB properties, you’re required to buy mortgage insurance if you use your CPF (which almost everyone does.) This takes the form of the Home Protection Scheme, which like other kinds of mortgage insurance, pays off your outstanding home loan if you pass on.
Since it’s an auto-include, most Singaporeans don’t think much about it. But this sort of mortgage insurance is not mandatory for private housing. Unless you specifically go out and buy it, there’s nothing to pay off your condo/landed property if the worst happens.
The risk is especially high for upgraders, who go from an HDB flat to a private property for the first time. I’ve met quite a few who remark that no one told them about needing mortgage insurance since HDB’s no longer running things for them. If so, consider this your alert; especially if it’s early in your home loan, and the outstanding amount is frightening.
Meanwhile in other property news…
- With the worry about property cooling measures in the air, is now a time to “wait and see?” After all, if the cooling measures kick in, properties should get cheaper right? We wish it was as simple as that.
- Want to save on that two per cent commission, and sell your own property? It’s possible, but it’s not for everyone. Best know what you’re in for.
- Seletar. So green. So breezy. So ulu and boring. But that may not be true for long, and Seletar may be one of the most underestimated parts of Singapore.
- If it’s a hot market, any property should be an easy sell! Or so the oversimplified notion goes. But in reality, even in the roaring 2025 property market, certain types of properties are just…harder to handle.
Weekly Sales Roundup (13 January – 19 January)
Top 5 Most Expensive New Sales (By Project)
| PROJECT NAME | PRICE S$ | AREA (SQFT) | $PSF | TENURE |
| PARK NOVA | $16,588,000 | 2906 | $5,708 | FH |
| THE RESERVE RESIDENCES | $4,270,000 | 1625 | $2,627 | 99 yrs (2021) |
| PINETREE HILL | $4,070,000 | 1668 | $2,439 | 99 yrs (2022) |
| THE ORIE | $3,998,000 | 1453 | $2,751 | 99 years |
| BAGNALL HAUS | $3,786,000 | 1528 | $2,477 | FH |
Top 5 Cheapest New Sales (By Project)
| PROJECT NAME | PRICE S$ | AREA (SQFT) | $PSF | TENURE |
| BAGNALL HAUS | $1,235,000 | 495 | $2,494 | FH |
| THE ORIE | $1,280,000 | 517 | $2,477 | 99 years |
| ONE BERNAM | $1,338,000 | 452 | $2,960 | 99 yrs (2019) |
| THE MYST | $1,342,000 | 657 | $2,044 | 99 yrs (2023) |
| EMERALD OF KATONG | $1,353,000 | 484 | $2,793 | 99 yrs (2023) |
Top 5 Most Expensive Resale
| PROJECT NAME | PRICE S$ | AREA (SQFT) | $PSF | TENURE |
| CAPE ROYALE | $5,707,000 | 2508 | $2,276 | 99 yrs (2008) |
| VILLA DELLE ROSE | $4,750,000 | 2777 | $1,710 | FH |
| THE SUITES AT CENTRAL | $4,588,000 | 1711 | $2,681 | FH |
| VIVA | $4,220,000 | 1528 | $2,761 | FH |
| BOTANIC GARDENS MANSION | $4,100,000 | 1755 | $2,337 | FH |
Top 5 Cheapest Resale
| PROJECT NAME | PRICE S$ | AREA (SQFT) | $PSF | TENURE |
| CENTRA STUDIOS | $648,000 | 409 | $1,584 | FH |
| PARC IMPERIAL | $698,000 | 366 | $1,907 | FH |
| KINGSFORD WATERBAY | $721,000 | 484 | $1,489 | 99 yrs (2014) |
| THE ALPS RESIDENCES | $735,000 | 463 | $1,588 | 99 yrs (2015) |
| KINGSFORD WATERBAY | $740,000 | 484 | $1,528 | 99 yrs (2014) |
Top 5 Biggest Winners
| PROJECT NAME | PRICE S$ | AREA (SQFT) | $PSF | RETURNS | HOLDING PERIOD |
| PARK NOVA | $16,588,000 | 2906 | $5,708 | $1,820,000 | 4 Years |
| KOVAN MELODY | $2,590,000 | 1410 | $1,837 | $1,709,600 | 18 Years |
| THE ANCHORAGE | $2,903,000 | 1421 | $2,043 | $1,564,000 | 27 Years |
| FLORIDIAN | $4,080,000 | 1701 | $2,399 | $1,540,000 | 15 Years |
| CEYLON CREST | $2,100,000 | 1206 | $1,742 | $1,430,000 | 21 Years |
Top 5 Biggest Losers
| PROJECT NAME | PRICE S$ | AREA (SQFT) | $PSF | RETURNS | HOLDING PERIOD |
| THE SCOTTS TOWER | $1,820,000 | 850 | $2,140 | -$1,125,418 | 13 Years |
| SKYSUITES@ANSON | $838,000 | 366 | $2,290 | $35,600 | 7 Years |
| KINGSFORD WATERBAY | $721,000 | 484 | $1,489 | $79,000 | 7 Years |
| RIVIERE | $2,500,000 | 818 | $3,056 | $89,550 | 6 Years |
| LOFT @ NATHAN | $910,000 | 452 | $2,013 | $95,000 | 6 Years |
Transaction Breakdown
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