Two numbers govern every housing loan in Singapore, and neither is the interest rate on the bank's brochure. The first is 55% — the share of your gross monthly income that all your debt repayments, combined, may not exceed. The second is 4% — the rate at which the bank must pretend your mortgage is priced when sizing it, no matter how cheap your actual package. Understand these two and you can estimate your maximum loan on the back of an envelope, before any banker does it for you.
The rule in one formula
"All existing monthly debt" is broad: other home loans, car loans, renovation and education loans, personal credit lines, and a minimum repayment on outstanding credit card balances. The bank works backwards: 55% of your income, minus existing commitments, is your capacity for the new mortgage — and that capacity is converted into a loan quantum at the 4% medium-term rate floor, not at the 1.4–1.9% packages currently on offer (see current mortgage rates). The stress test is why a loan that comfortably fits your budget at today's rates can still be rejected: the regulator is sizing it for the rate environment you might face, not the one you signed at.
Your income bracket, your maximum loan
The table below converts gross monthly income into an estimated maximum loan, assuming no other debt. It is a starting point, not a ceiling promise — actual approval depends on your credit profile, income mix and the bank's assessment.
| Gross monthly income | Max debt service (55%) | Max loan · 30-yr @ 4% | Max loan · 25-yr @ 4% |
|---|---|---|---|
| $4,000 | $2,200 | ~$461,000 | ~$417,000 |
| $5,000 | $2,750 | ~$576,000 | ~$521,000 |
| $6,000 | $3,300 | ~$691,000 | ~$625,000 |
| $8,000 | $4,400 | ~$922,000 | ~$834,000 |
| $10,000 | $5,500 | ~$1,152,000 | ~$1,042,000 |
| $12,000 | $6,600 | ~$1,382,000 | ~$1,250,000 |
| $15,000 | $8,250 | ~$1,728,000 | ~$1,563,000 |
| $20,000 | $11,000 | ~$2,304,000 | ~$2,084,000 |
Two readings worth noting. A dual-income household around $8,000 — the most common upgrader profile — supports roughly a $922,000 loan, which at 75% LTV implies a purchase budget near $1.23 million before equity constraints. And the tenure columns show that the 30-versus-25-year choice alone shifts eligibility by $50k–$100k at typical incomes — a lever many buyers never think to pull.
How existing debt quietly shrinks your loan
Because the stress test converts monthly capacity into quantum at 4% over 30 years, the exchange rate is brutal and roughly linear: every $500 a month of existing commitments removes about $100,000 of property loan. Here is the same $8,000-income household with progressively heavier obligations:
| Existing monthly debt | Remaining capacity for property loan | Max property loan (30-yr @ 4%) |
|---|---|---|
| $0 — no existing debt | $4,400 | ~$922,000 |
| $500 — e.g. a car loan | $3,900 | ~$817,000 |
| $1,000 — car + study loan | $3,400 | ~$712,000 |
| $1,500 — multiple obligations | $2,900 | ~$607,000 |
| $2,000 — heavy existing debt | $2,400 | ~$503,000 |
Read row two twice: a fairly ordinary $1,000-a-month car commitment costs this household roughly $210,000 of property loan — frequently the gap between a two-bedder and a three-bedder at the same launch. If an upgrade is 12–18 months away, clearing or refinancing consumer debt first is usually the highest-return financial move available.
The fine print that moves your number
Variable income takes a 30% haircut. Commissions, bonuses, allowances and rental income are discounted by 30% before the computation. A borrower on $10,000 of fully variable income is assessed at $7,000 — the maximum loan falls by almost a third relative to the same fixed salary. Self-employed and commission-based buyers should run their numbers on the discounted figure from the start.
MSR stacks on top for HDB and new ECs. If you are buying an HDB flat or a new executive condominium, the Mortgage Servicing Ratio additionally caps the housing instalment alone at 30% of gross income — and it is usually the binding constraint, biting before TDSR does. Private condo purchases face TDSR only.
Tenure and age gate your LTV. The standard 75% LTV assumes the loan stays within the tenure cap (30 years for private property) and ends by age 65. Stretch past either and LTV drops to 55% — the borrowing age used for joint borrowers is an income-weighted average, so pairing a younger, higher-earning borrower can preserve both tenure and LTV.
Owner-occupier refinancing is exempt. Refinancing the loan on the home you live in is not subject to the 55% threshold, so a fall in income does not trap you in an expensive package.
Verdict: know your number before the viewing
TDSR is not a hurdle to negotiate at the end of a purchase; it is the budget-setting step that should come first. The practical sequence: take gross household income, apply the 30% haircut to any variable portion, multiply by 55%, subtract every existing monthly commitment, and convert what remains into a loan at 4% over your realistic tenure using the tables above. Add your cash and CPF at 75% LTV and you have a defensible maximum budget — the same arithmetic we walk through end-to-end for upgraders in Selling your HDB to buy a new launch, and the number every payment stage in Buying a new launch condo ultimately rests on.
Frequently asked questions
What is TDSR?
An MAS rule capping all monthly debt repayments — the new mortgage plus every other commitment — at 55% of gross monthly income, applied to virtually all property loans from financial institutions in Singapore.
What is the 4% stress-test rate?
The medium-term interest rate floor banks must use when sizing residential loans. Your maximum loan is whatever fits 55% of income at 4%, even if your actual package charges 1.4%.
What counts as debt?
Other home loans, car loans, renovation and education loans, personal credit lines, minimum repayments on credit card balances, and a portion of guarantor obligations.
TDSR vs MSR — what's the difference?
TDSR caps total debt at 55% of income for all property loans. MSR additionally caps the housing instalment alone at 30% of income, but only for HDB flats and new ECs — and it usually binds first.
How is variable income treated?
Commissions, bonuses, allowances and rental income are haircut by 30% before the computation, so fully variable earners are assessed at 70% of headline income.
How much does a car loan cost me in property loan terms?
Roughly $100,000 of quantum for every $500 of monthly commitment, at the 4% stress rate over 30 years. A $1,000/month car loan removes about $200,000.
Does tenure change my maximum loan?
Yes — the same monthly capacity supports about 10% more loan over 30 years than 25. But exceeding the tenure cap or borrowing past age 65 cuts LTV to 55%, which usually costs more than the tenure gains.
Is anything exempt from TDSR?
Refinancing the mortgage on the home you occupy is exempt from the 55% threshold. New purchases and investment-property refinancing are not.
Update history
- Guide published. Tables computed at the 55% TDSR threshold and 4% medium-term stress rate over 25- and 30-year tenures.
Methodology & sources. Thresholds, haircuts and exemptions follow the MAS TDSR framework and prevailing LTV rules. Loan quantum tables computed as standard amortising loans at the 4% p.a. stress rate, rounded to the nearest $1,000.
Disclaimer. All figures are illustrative estimates for education, not financial advice and not a promise of loan approval. Actual eligibility depends on your credit profile, income mix, existing obligations, property type and the bank's assessment. Speak with a mortgage specialist or your bank for a personalised computation.
Talk it through with an advisor
Our research tells you what the data says. If you want to work through what it means for your own situation — budget, ABSD position, timing an HDB sale, or comparing launches against resale options — you can request a one-to-one consultation.
- No obligation, and no pressure to transact — the first conversation is about your goals, not a product.
- Personalised affordability and stamp-duty scenarios based on your actual numbers.
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