How To Check Your Housing Loan Balance
Staying up to date with your housing loan balance is crucial. Missing a repayment schedule, whether intentionally or otherwise, can plunge your life into a huge financial crisis.
To avoid this, it is important to keep monitoring your monthly HDB and bank mortgage statements. Unfortunately, lenders do not coach borrowers on how to access and read their loan statements.
But in this article, we will explain how to check housing loan balance when reviewing your monthly HDB and bank mortgage statements.
How To Check HDB Statement of Account For Housing Loan
If you have an existing HDB loan and have been making monthly repayments, here’s how to access and review your mortgage statements.
The four-step process requires your Singpass.
Step 1: Use your Singpass to access the Statement of Account page in HDB’s portal.
Logging in to the portal is a fast process that takes roughly a minute. If you are having difficulties remembering your Singpass password, you can reset it online within a couple of minutes.
Step 2: After successfully logging in, the portal will present you with your loan summary.
Step 3: Click the icon that says “View Statement of Account”.
Prior to clicking on the red “View Statement of Account” prompt, there are several points to look out for.
On the second row, you’ll see “Outstanding Balance”. In the second column of the same row, you will see the balance written in figures. This amount is the remaining loan principal. Confirm whether the amount is consistent with your personal records.
If you are late on your monthly repayment, they will appear in the “Outstanding Installment” section. Ideally, any amount in this section indicates non-compliance and may affect your credit score.
Another point to note on this screen is the housing loan interest calculator. You can use the calculator to determine the pending balance. Also, the screen provides the pre-paying option.
Step 4: At this point, the HDB portal will have presented you with the entire statement. You can decide to go through the entire statement from the first monthly repayment.
If you are only interested in a specific month or year, you can set your desired time frame.
How To Check Outstanding Housing Loan Statement
Like with any other loan, checking for outstanding housing loan statements requires accessing the records of the lender.
Fortunately, digitisation has made it possible for HDB and commercial banks to offer borrowers the opportunity to access their records remotely. You do not have to visit HDB or your bank physically to access your data. You can do it from the comfort of your home, car, or wherever.
Even better, the data can be accessed via smartphones. You do not need to have a laptop or desktop to access your loan statements.
Upon clicking the “View Statement of Account”, the portal will present you with a page showing the date of payments, the charge code, and the amount.
The first code that appears on the screen is Bal-BF. This stands for balance brought forward. It denotes the outstanding balance at the beginning of the selected period.
The second code is IP-2.60. This code stands for the interest charged on the outstanding balance, and 2.60 represents the interest rate of 2.6%. If the interest rate changes, this number will also follow suit.
Given that the interest is charged on the outstanding balance, you should expect the rate to continue reducing every time you make the repayment.
Prepayment can also reduce the interest amounts. The good thing is that HDB does not charge early repayment fees. The absence of the fees is meant to incentivise borrowers to repay their loans as soon as they can.
How To Read Your Bank Mortgage Statement
The components of a mortgage statement do not differ significantly from one bank to another, or even from the HDB statement. Although the terms may differ, the basics remain the same.
There are many ways to access your bank’s housing loan statements.
You can request your bank to provide you with your mortgage loan transaction history for specific time frames via email. You can also access the information via the customer’s portal on the bank’s website or via the bank’s mobile app.
The bank’s mortgage transaction history has four main sections: the outstanding amount, details of the loan, repayment record, and interest charged.
Most of these details do not differ greatly from the HDB home loan. However, you are likely to find the interest rate confusing as it can increase or decrease. Unlike HDB, the interest rate of bank housing loans is not consistent, especially after the lock-in period.
The interest rate can change in response to the repo rate, the number of days in that specific month, and the changes in the outstanding amount. With bank loans, interest rates are reviewed on a daily basis.
Reviewing Your Bank Mortgage Annual Statement
A proper reading of your bank mortgage statement should start with the outstanding balance. This is the amount that is pending clearance after deductions of your monthly repayments.
Next, look at the total monthly installment amount. Summing up the 12 monthly repayments should agree with the recorded total.
The changing nature of floating interest rates common with bank housing loans causes changes in monthly installments.
Ensure that you check the interest amount charged over the year. Due to the constant change in interest rates, most banks will only indicate the amount charged and not the percentage rate applied.
For this reason, you need to familiarise yourself with the formula the bank uses to calculate the interest rate. If in doubt, you can ask the bank to provide you with the various interest rates applied over the year.
The outstanding balance should decrease with every repayment. It is important to check that the reduction takes place as expected.
How Checking Your Housing Loan Balance Helps You
Checking your annual HDB or bank mortgage statements can help paint the complete picture of the total interest paid.
This figure is more important for bank home loans because of the volatile nature of the interest rates. Unlike fixed rates that hold constant, floating rates respond to market forces.
Also, monitoring these statements helps anticipate how much interest you are likely to pay in the following year. All this information can help you decide if the mortgage is still affordable.
With this data, it will also be easier to determine whether to go for refinancing or repricing if the financial toll is proving unbearable.
Refinancing has to do with moving the mortgage to another bank in pursuit of better interest rates. Repricing refers to acquiring a new home loan that has better terms than the existing one.
Corrects Ongoing Errors
Monitoring your annual statements can help pinpoint errors with simple tabulations such as subtractions or missed entries.
For example, if the staff tasked with updating your mortgage data mistakenly skip a repayment, you may end up shouldering the mistake to the end of the tenure.
Even worse, a missed entry could result in costly penalties and even legal proceedings. The assumption that you’ve deliberately failed to make a repayment can result in legal warnings.
While you can easily settle the matter in court, nothing can repair the injury that such proceedings may cause to your reputation.
Guards Against Possible Default
An event of default is a term that refers to multiple scenarios in which borrowers fail to adhere to the terms of a loan agreement. Examples of such scenarios include late repayment, insolvency, and non-compliance to mutually agreed obligations.
If the bank decides that an event of default has happened, it can take several measures against you. Consequently, this can lower your credit score, result in additional fees on your agreement, or even the seizing of your property.
All these can result from minor errors such as the date recorded for monthly repayment. If the system shows that your monthly repayment date was made on the 10th as opposed to the 1st, that can trigger the consequences of an event of default.
Always Check Your Housing Loan Balance
Now that you know how to check housing loan balance, taking time to check your housing loan statements is a prudent and smart financial decision.
Besides helping with planning, it can also prevent you from suffering the consequences of human error.
If you still feel like you need help with managing your mortgage payments, talk to the loan advisors at BST Credit.
Frequently Asked Questions
1. Does The Statement Of Account In The HDB Portal Show All Loan Transactions?
No. The HDB portal shows transactions for the current year and the past few years.
2. How Can I Access Statements Not Shown In The HDB Portal?
All transactions are available, even if they are not immediately accessible at the point when you need them. If that happens, you can make a request online for past statements.
3. What Are The Benefits Of Keeping A Healthy Credit Score?
A good credit score gives you benefits such as fast loan approvals, stronger negotiating positions, and better deals.
Lenders tend to listen to those who have a good track record of adhering to loan agreements. They are also likely to make the process of acquiring loans much easier for prospects with positive credit scores.