I heard from some friends that hdb do not allow you to downgrade your flat unless there is valid proof to show that you're financially unsound. Is this true?

Wat happens if you inherit a smaller flat from your parents and you wish to stay in that flat and sell your existing bigger flat. Is this possible? Anyone has experiences to share?

Personally I find it quite ridiculous if hdb dun allow pple to downgrade...afterall, we are paying it with our own money.

I heard from some friends that hdb do not allow you to downgrade your flat unless there is valid proof to show that you're financially unsound. Is this true?

Wat happens if you inherit a smaller flat from your parents and you wish to stay in that flat and sell your existing bigger flat. Is this possible? Anyone has experiences to share?

Personally I find it quite ridiculous if hdb dun allow pple to downgrade...afterall, we are paying it with our own money.

HI Prettibride,

Its not that HDB do not allow downgrade, its jst that they do not allow you to purchase a flat using HDB loan if you choose to downgrade to a smaller unit. For example, I now have a 5room flat bought with HDB loan. If I choose to sell this unit and buy a 4room flat, I cannot take another HDB loan to buy that 4room. I have to take a bank loan.

Thats all that it is.

If you inherit a smaller flat and wish to stay in that, you can sell off urs, and buy over ur parents' flat using the earnings. If you don't have to borrow any amount from HDB to offset the cost of the smaller flat, then it's not a problem. If you need a loan, then u'll need to loan from a bank.

This is a very sticky rule that they abide by. Even if you are in difficult situation, they may not give provision to downgrade using HDB loan. Its on a case by case basis.

Downgrade yes, but only can buy resale flats, not new flats if you exceed the income ceiling rule set by HDB.

of cos u are allow to downgrade to new flat, provide you have stay in your existing flat for 5yr..mean u must met the MOP and u will be paying a levy when downgrade..if u are buying 2nd new flat..and cos cos u must take bank loan, no hdb loan[/color]

HI Prettibride,

Its not that HDB do not allow downgrade, its jst that they do not allow you to purchase a flat using HDB loan if you choose to downgrade to a smaller unit. For example, I now have a 5room flat bought with HDB loan. If I choose to sell this unit and buy a 4room flat, I cannot take another HDB loan to buy that 4room. I have to take a bank loan.

Thats all that it is.

If you inherit a smaller flat and wish to stay in that, you can sell off urs, and buy over ur parents' flat using the earnings. If you don't have to borrow any amount from HDB to offset the cost of the smaller flat, then it's not a problem. If you need a loan, then u'll need to loan from a bank.

This is a very sticky rule that they abide by. Even if you are in difficult situation, they may not give provision to downgrade using HDB loan. Its on a case by case basis.

I tot the reason stopping most people from downgrading is due to the Resale Levy payable on sale of the first subsidised flat

Btw, I dun think you can inherit a HDB flat from your parents. The flat can be transfer from your parent to you (ie your parent sell to you) and you start paying the loan all over again.

I tot the reason stopping most people from downgrading is due to the Resale Levy payable on sale of the first subsidised flat

Btw, I dun think you can inherit a HDB flat from your parents. The flat can be transfer from your parent to you (ie your parent sell to you) and you start paying the loan all over again.

Maybe thats another factor. But fact is you cannot downgrade to a small flat and apply for a HDB loan, you can only upgrade and apply for HDB loan.

Must be careful with our choices!!

The part about the Resale Levy is that if you are not buying a new HDB flat or not taking any HDB grant, there is no need to repaid back the Resale Levy.

Of course HDB allows people to downgrade. You will have to sell off your existing unit and buy over the smaller unit. Please calculate if you have the $$ for it after the transcation. As many have already mentioned, you can only take bank loan.

so it's buy a 2nd flat first then sell off 1st flat or u sell off first then buy?

it should be buy then in 6 months need to sell off the 1st flat right?

so it's buy a 2nd flat first then sell off 1st flat or u sell off first then buy?

it should be buy then in 6 months need to sell off the 1st flat right?

it depends on your needs

if you can't afford to service two loans at one go, then you'll have to sell off 1st flat before getting 2nd one or use the contra facility

but if you have enough to pay down 20% on the 2nd flat and service both loans at one go, there is a 6 months grace for you to sell the 1st flat AFTER taking over the 2nd flat. however, there had been instances where forummers managed to delay the selling for 2 years. at the expiry of the grace period, just go to hdb and explain to them why you didn't manage to sell your flat and ask for extension

to TS, there is no rule against downgrading

if you inherit the flat from your parents, the only thing you must do is sell off either unit coz one family nucleus is allowed to 'own' one hdb flat.

even for taking hdb loan, downgrading is possible by appealing to hdb.

friends have successfully done so i.e. sold their 4-rm bought with grant and buy 3-rm with hdb loan

Edited June 3, 200719 yr by applefreak

I tot the reason stopping most people from downgrading is due to the Resale Levy payable on sale of the first subsidised flat

Btw, I dun think you can inherit a HDB flat from your parents. The flat can be transfer from your parent to you (ie your parent sell to you) and you start paying the loan all over again.

Why not? HDB flat is just like any other asset, it can be passed down through inheritance via will. Of course, you'll have to take over the loan, if there is any outstanding. But if your parents live to a ripe old age, it's likely the flat will be completely paid up.