HDB Loan Scheme Lifeline For Bankrupts

Source : The Straits Times, Apr 26, 2008

ABOUT 40 people who have been made bankrupt and face trouble securing home loans from a bank or the Housing Board (HDB) have found a lifeline in the form of a new loan scheme.

Introduced in July last year by the HDB, these loans are designed to make it easier for bankrupts to find new homes and pay off their debts.

But loan applicants must first satisfy the HDB's criteria, which include having the money to service monthly mortgage instalments while still satisfying creditors.

An HDB spokesman told The Straits Times on Friday that proceeds from the sale of an existing flat should be used to finance a smaller home.

'To be realistic in determining what they can afford, buyers should consider their existing financial commitments.'

'(These include) allowances to support children and parents, payment towards utilities and transport,' said the spokesman.

There were 25,961 undischarged bankrupts - people who are still paying their debts - in Singapore as at the end of February this year, according to government statistics.

Read the full story in Saturday's edition of The Straits Times.