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Part I – Obtaining a Renovation Loan

Singaporeans obtain renovation loans for a variety of reasons. It could be because their homes are too old and need to be repaired, they want an extensive interior design project, remodeling of their homes or extending their houses (this only applies for those with landed property). Usually renovation works are paid partially or upfront. For upfront payment, homeowners usually require a large amount of cash.


These homeowners can always opt to use their credit cards. But can you image the 24% APR? Your credit card will be maxed out if your renovation cost is really steep – say, $50,000 in total. Loan sharks are of course, a big NO. You should not even consider it. Renovation loans, however have an average of 3-5% APR.

For those of you who don’t know it, some banks offer furnishing loans on top of renovation loans. The furnishing loan is usually capped at 6 times your income. The standard tenure is usually between one year to five years.

The requirements of most loans are:

  • You have to be a Singaporean or a Singapore Permanent Resident
  • Be between 21 to 55 years of age
  • Have a minimum income of $24,000 per year
  • Have a fair credit score on hand

You should always consider the improvements, interior design job and remodeling you need to do before you try to apply for the renovation loan. Evaluate everything before you go off and loan the amount you think you will be spending.

You also have to take note that renovation loans cannot be refinanced. You should note that if you pick a five year loan, they most likely, you will be stuck paying the amount owed to the bank for five years. As the renovation is for consumption and not an investment, you should pay the debt quickly.

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