How CPF Accrued Interest Will Affect You!

80% of the Singapore population live in a HDB flat, but how many of us have learnt about the negative impact on CPF Accrued Interest?

Facts: It is compulsory that any CPF funds used or received to finance a HDB be returned when the flat is sold. How do you calculate the repayment amount? Basically, the principal amount used or received plus the accrued interest (which is currently at 2.5%).

So how does this implicate you as a HDB owner? The longer you hold on to your flat, the higher the accrued interest.

Even if you have fully paid off your mortgage loan, the CPF Accrued Interest continues to compound at 2.5% per annum. Unfortunately for the majority of HDB owners, the expected cash proceeds were much lesser than expectation. In some cases, there were even HDB owners who faced negative sales.

To combat against the 2.5% compounded CPF Accrued Interest, your HDB flat has to appreciate at least 2.6% per annum.

The pioneer and merdeka generations have seen their HDB value appreciated from $30,000 to $300,000. But how possible is it in today’s 21st century for a HDB flat to appreciate exponentially?

We are Pamela & Shirley here from Wonderhomesg.com. If you are looking to grow your asset wealth through real estate, or sourcing for ways to combat against CPF Accrued Interest, drop us a private message and we will get back to you soonest.