Total Debt Servicing Ratio (TDSR)

Total Debt Servicing Ratio (TDSR)

In Singapore, navigating property financing is guided by key regulations like the Total Debt Servicing Ratio (TDSR) and Mortgage Servicing Ratio (MSR), ensuring borrowers don’t overextend their finances. TDSR, capped at 55% of a borrower’s gross monthly income, evaluates one’s ability to service loans based on their income and existing debts. This measure applies to both public and private property loans and is a cornerstone of the Monetary Authority of Singapore’s (MAS) framework to promote financial prudence among households.

MSR, on the other hand, specifically targets HDB flats and Executive Condominiums (ECs) buyers, limiting mortgage repayments to 30% of the gross monthly income. This ensures that housing remains affordable for Singaporeans, particularly for these government-supported housing types. Both TDSR and MSR were implemented to curb excessive borrowing and speculative investment in the real estate market, contributing to a stable and sustainable property sector.

Understanding these ratios is crucial for potential homeowners and investors, as they directly influence loan eligibility and borrowing capacity. By setting clear boundaries on borrowing limits, these regulations guide individuals towards making informed and responsible financial decisions in property investments.


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