Can You Use a Personal Loan to Buy a House in Singapore?

The property scene in Singapore is fiercely competitive, and financing your dream home can prove to be a daunting task. If traditional mortgage options aren’t cutting it, you might find yourself mulling over unconventional alternatives like personal loans. 

To make a sound choice, it’s crucial to comprehend the fundamental differences between personal loans and mortgages. Let’s delve into when it may be more prudent to explore the road less taken and consider a personal loan.

Grasping the Contrast Between Personal Loans and Home Loans

A personal loan offers a flexible means of borrowing funds, available for an array of purposes – whether you need to pay off medical expenses, clear credit card debts, or purchase an engagement ring. This type of loan is favored by borrowers due to its straightforward application process, which doesn’t require any valuable assets as collateral.

On the other hand, a home loan allows you to procure your dream home without spending a dime from your savings. However, to secure such a loan, you must offer the property as collateral, and ownership is only granted upon complete repayment of the borrowed principal amount along with interest.

Loan Showdown: Personal Loans vs. Housing Loans

When it comes to seeking fiscal support, two heavyweight contenders immediately spring to mind – the collateral-free personal loan and the secured housing loan.

Interest Rates

Typical Interest Rates for Personal Loans
Personal loans in Singapore usually have higher interest rates, ranging from 3.5% to 10.8% per annum, depending on the borrower’s credit profile and the lending institution.

Typical Interest Rates for Housing Loans
In contrast, housing loans often offer more competitive interest rates, typically starting from around 1% to 3% per annum, which can result in significant savings over the loan tenure.

Loan Tenure

Maximum Tenure for Personal Loans
Personal loans have shorter loan tenures, usually between 1 to 7 years. This short repayment period results in higher monthly installments, making it harder for borrowers to manage their finances.

Maximum Tenure for Housing Loans
Housing loans, on the other hand, offer longer loan tenures, with repayment periods of up to 25 or 30 years. The extended repayment period allows borrowers to spread out the loan cost, making the monthly installments more manageable.

Loan Amount

Borrowing Limits for Personal Loans
Personal loans have lower borrowing limits, typically capped at 4 times the borrower’s monthly income. This limit may not be sufficient to cover the full cost of a house in Singapore’s expensive property market.

Borrowing Limits for Housing Loans
Housing loans, conversely, provide higher borrowing limits, with Loan-to-Value (LTV) ratios of up to 75% for eligible buyers. This allows homebuyers to secure a larger portion of the property cost through financing.

Limitations and Risks of Using Personal Loans to Finance a House Purchase in Singapore

Financing your dream home with a personal loan may seem like a quick fix, but it comes with drawbacks like sky-high interest rates, shorter repayment periods, and restricted loan amounts that might leave you in a financial bind. Moreover, you could land in legal and monetary predicaments. The smarter choice? Go for housing loans that cater to your property-buying needs in Singapore.

Choosing the Right Home Financing Solution in Singapore

To ensure a sound fiscal choice, it’s important to consider better and more cost-effective options. Enter home loan banks, which proffer lower interest rates and a stretched-out repayment schedule, specifically tailored for property procurement.

List of Home Loans in Singapore 

1. Standard Chartered

Discover the world of possibilities with Standard Chartered’s home loans. If you’re in search of a home loan solution for a lower-value property, starting at $100,000, then look no further. Get your hands on low-interest rate mortgages with options for fixed rate and SIBOR-linked deals, making it an ideal choice for those seeking a superb home loan solution.

2. UOB Home Loan

Experience the thrill of lightning-fast approvals with UOB’s private home loans. With approvals given within minutes, you’ll never have to wait for your dream home again. And with refinancing, you can receive gifts of up to $3,800, making this the perfect choice for those looking for fast approval and extra perks.

3. DBS

Join the thousands of homeowners who trust DBS to finance their dream homes. This reputable bank offers some of the best rates in Singapore, with a good range of deals and no lock-in period, making it a top choice for those looking for competitive home loans.

4. Citibank

Step into luxury with Citibank’s home loans for pricier properties. They offer competitive refinancing options and fixed deposit deals, making it the ideal choice for those seeking higher-value home loans above $500,000.

5. Maybank

Make your dream home a reality with Maybank’s trusted home loans. Choose from an amazing selection of loans, especially floating rate deals, and get financing up to 75%. Whether you’re just starting out or looking to upgrade, Maybank’s home loans are the perfect solution.


Find peace of mind with HSBC’s reliable and dependable mortgages. As the go-to provider for fixed deposit mortgages, HSBC is the perfect choice for those seeking a trustworthy bank to finance their home. With a worldwide reputation as a banking leader, you can be confident that HSBC is the right choice for you.

Appropriate Uses of Personal Loans in Property Purchases

While personal loans may not be the ideal choice for funding the bulk of a property purchase, they can still come in handy for covering peripheral expenses.

Home Improvements

Enhancing your humble abode with new upgrades and renovations can be achieved through a practical solution – utilizing a personal loan. Contrary to popular belief, housing loans may not cover all expenses related to home improvements, making personal loans a smart choice to consider.


Decorating a new residence with stylish and comfortable furnishings can be an expensive undertaking. However, with the assistance of personal loans, homeowners can alleviate the financial burden of outfitting their living spaces to their liking. These loans offer flexible terms and competitive rates, making it easier than ever to create a cozy and inviting home.


When it comes to purchasing property in Singapore, choosing a personal loan may leave you with elevated interest rates, shorter repayment periods, and limited loan amounts. What’s more, the risks of legal and financial issues make it a less-than-optimal choice. Instead, opt for a specialized housing loan tailored to meet your specific real estate investment needs. Not only will it provide more favorable terms, but it can also lead to more positive outcomes in the long run.

Meet Your Ultimate Financial Partner – Accredit Pte Ltd

Whether you require quick cash for sprucing up your living space or upgrading your furniture, Accredit Moneylender is the top-notch option for you. With a commendable track record of 17 years, a whopping 200K+ successful cases, and a satisfied clientele, we’re the go-to source for Singapore’s most affordable short-term loans. 

Get in touch with Accredit Licensed Moneylender today and get your hands on the cash you need!

Awarded by Ministry of Law to operate a new Pilot Programme, we have been providing transparent and quality service since 2002.


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