A renovation loan is an unsecured loan regulated by the Monetary Authority of Singapore (MAS) that helps homeowners finance home improvement works. Unlike a personal loan, renovation loans are specifically meant for structural and built-in works, such as:
– Electrical and wiring upgrades
– Flooring and tiling
– Painting and redecorating
– Bathroom and sanitary fittings
– Structural alterations approved by HDB or BCA
Note: Renovation loans typically cannot be used for furniture, appliances, or non-permanent fittings.
In Singapore, homeowners can choose between a personal renovation loan from banks or licensed moneylenders, or an HDB home renovation loan (for eligible HDB flats). Each option has different interest rates, loan limits, and eligibility criteria.
When applying for a renovation loan in Singapore, one of the most important considerations is the interest rate, as it directly affects your monthly repayment and the total loan cost. Most banks and licensed moneylenders offer renovation loan packages with interest rates ranging between 3.5% and 5.5% per annum, depending on the loan amount, borrower’s profile, and repayment tenure. For example, some local banks may offer promotional packages from as low as 3.88% p.a., while licensed moneylenders typically structure rates differently, often with more flexible terms.
There are generally two ways lenders calculate interest:
– Interest is charged on the full loan amount throughout the tenure. For instance, a $30,000 loan at a flat rate of 4% over 5 years will apply 4% interest to the original $30,000 each year.
– Interest is charged on the outstanding balance after each repayment. This usually results in a lower effective cost compared to flat rates.
Your loan tenure also affects the total repayment. A longer tenure means smaller monthly instalments but higher overall interest charges, whereas a shorter tenure requires larger monthly payments but reduces the total interest paid.
Factors influencing renovation loan interest rates include the loan quantum, the borrower’s credit score, income stability, and property type (HDB, condominium, or landed). Comparing multiple offers and understanding the effective interest rate (EIR) will help you identify the lowest renovation loan interest suitable for your financial situation.
While a personal loan is more flexible than a renovation loan, these benefits come at higher interest rate. 118 Credit wants you to have your dream home, and that is why we keep our interest rates competitive for a home renovation loan.
Renovation loans have a longer loan tenure than personal loans. This way, you have a longer runway to pay off your loan amount, making it more comfortable for you. At 118 Credit, we have different loan plans for you to choose from!
Taking up a renovation loan will give peace of mind, as the property owner, you have all the funds needed to realize your dream makeover! This will boost your home’s value if you ever decide to sell your home.
The greatest benefit is really just getting that home you’ve always dreamed about. Having a home you are proud of is also important for you and your family’s happiness! Everyone wishes for home and not just a house.
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You can borrow up to 6 times your income, but this figure is subject to each individual. Give us a call to find out more on your loan amount!
Chat with us for more information on home loans, home loan interest rates and the respective loan tenure.
Step 1:
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Step 3:
Set an appointment with our team to come down to our office. The loan assistant will also tell you exactly what documents we need you to bring.
Step 4:
The loan assistant will check all the documents, and then explain clearly all the terms and conditions of the loan. They will help determine the loan amount to be given, and work out a comfortable monthly repayment schedule for you. The loan repayment amount will be determined based on your income, and we can customise this for you too.
Step 5:
Once the documents are in order, monthly repayment is set, and the loan contract is signed, you will get the money! It is fast, simple and efficient.
If you currently have a home loan, you should choose to take a renovation loan from the same lender. Lenders are more likely give a better interest rate to their existing home loan customers.
Don’t gloss over any details. These can include interest rates, processing fees, late payment fees and any possible cancellation fee.
While you might be tempted to max out the loan amount in order to get a perfect house, we strongly advise against that.
Do remember that you have to pay back the principal plus interest. Your loan assistant can advise you on further details regarding taking out a loan.
A renovation loan is a type of loan in Singapore specifically designed to cover the costs associated with home renovations, such as remodelling, flooring, painting, and other improvements. Unlike a personal loan, a renovation loan typically offers lower interest rates and longer repayment tenures, making it a popular choice for homeowners.
A personal renovation loan is intended solely for home renovation expenses. Compared to a personal loan, which can be used for various purposes, a personal renovation loan often comes with more attractive terms such as a larger loan amount, lower renovation loan interest rate and longer repayment periods **. At 118 Credit, we offer flexible personal renovation loan options to suit your needs.
An HDB home renovation loan is tailored for homeowners of HDB flats who need funds for their renovation projects. This loan ensures that your renovation costs are well-covered, allowing you to create a comfortable living space. At 118 Credit, our HDB renovation loan packages are designed to meet the needs of Singaporean homeowners. By providing a renovation quotation from your contractor or ID, we may be able to customise a loan plan for you!
The renovation loan interest rate in Singapore can vary depending on the lender, loan amount, and tenure. At 118 Credit, we strive to offer competitive interest rates and attractive loan tenures to help you manage your renovation expenses effectively. Our competitive interest rates start from 1% per month, with no penalties or extra charges if you decide to do an early full settlement of the loan!
The maximum loan amount you can borrow with a renovation loan in Singapore depends on various factors, including your income and the lender’s policies. At 118 Credit, you can borrow up to six times of your monthly income based on your financial profile. Additionally, if your spouse applies with you, you will be able to apply for a larger loan amount! **
A renovation loan is typically meant for structural and interior renovation work. However, some lenders may allow part of the loan to be used for purchasing furniture or appliances. At 118 Credit, you are able to purchase furniture and electrical appliances with our loans. Furthermore, our loan specialists can guide you on how your loan can be utilised.
To apply for a renovation loan in Singapore, you must meet the following criteria:
For more information or to apply for a renovation loan, reach out to our team at 118 Credit today!
** Terms & conditions applies, credit amount and term is subjected to live financial profile
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