Buying an HDB flat together

 

Each has one great love and when you found it, this will be for life.  Your next move is to settle in a place where love and life are celebrated, maybe having a thing called HDB.  A phenomenal way of sealing your commitment!  There are significant points to consider and discuss before doing it.

They are the following:

•  How are you going to register the property, is it in one name or two names?
• If in case you want to register the property in two names, how would you wanted yourselves to appear in the document, it is as joint tenants or tenants-in-common?
• If in case the property is registered in one name and your partner is contributing through cash, how are you going to deal with those payments?

The rule says, “A sole single person under the Single Singapore Citizen Scheme (SSCS) or two singles jointly under the Joint Singles Scheme (JSS), are  qualified to purchase a new 2- room BTO flat in a non-mature estate (subject to ceiling income) or a resale HDB flat in any size (no income ceiling).”

 

Purchasing an HDB flat in one name under SSCS

If both of you have the intention to purchase the HBD flat in one name and with the purpose that whoever is registered owner of the flat is understood to have a share on trust for his partner, but remember this private agreement is void in courtTrust done with an HDB flat is restricted and invalid if no written consent from HDB (see section 51(8) and (9) of the HDB Act)

• A trust document signed by a lawyer is still not honoring not unless it is attached with written consent from HDB.
• Any amount you drop for the down payment or monthly amortization in the HDB flat not under your name is unacknowledged by the law like offering favorable interest in the flat. Some things are beyond control, one day, you both decided to break up after giving enough cash payments of the flat which is not registered under your name, you then can never ask for a share over the HDB flat.  You can try to retrieve the money from your partner or other parties as a form of debt and there is the tendency that they will claim that those payments you made were your gifts to them.
•  If in case it is registered under the name of one person only, it does not mean that it will automatically be inherited by the other person or partner when the other person dies.  When the intention of giving the HDB flat is in your side and the registered owner died, last will and testament should validate it. Nonetheless, you must remember that a Will can be altered by the maker without letting you know or asking your approval unless your name is the one printed in the title deeds.
• If left with no choice but to purchase an HDB flat in a single name directly below SSCS (for instance, because one of you is not a legal citizen of Singapore or under  35  years old yet), next, you have an option of acquiring a loan agreement drawn up that offers for the amount to be shared by you to desired flat so it will be acknowledged and be paid back as a loan to the valid owner.   So, in this way,  when things fail, somehow you are better side to retrieve money back.

 

Joint names in acquiring an HDB flat under JSS

When the two buyers are both Singaporean citizens, over 35 years old and don’t have private property, the best solution is to apply together for an HDB flat as common or joint owners ( under JSS)

 

What’s the distinction between tenancy-in-common and joint tenancy?

A tenancy-in-common (TIC), the percentage of ownership for each buyer or partner is clearly specified, for instance, 80 percent -60 percent or 50 percent – 50 percent depending to the agreed contribution or proportion of the ownership.

A joint tenancy (JT) refers to the whole property acquired by both or partners jointly , no delimitation of percentage which means, both have the same percentage rights over to the property bought.

 

Survivor brings all, or not?

In the case of a joint tenancy, if one owner loses one’s life, automatically, the property is given to the existing other owner or partner. While tenancy–in–common, automatic transfer of the deceased share of the property doesn’t exist.

The person must have a signed paper stating the giving of his property to his partner while still alive or a written Will must be provided. If both options are undone, as per the intestacy laws, the shared property of the deceased owner will be given to the immediate family member.

The surviving owner will look for the immediate family members of the deceased partner, she or he will then know coverage of the property the relative owns now.  It is expected that the relatives might request the surviving owner to pay rent or trade the property and divide the proceeds.

 

Which arrangement should I favor?

It matters on your own needs and lifestyle. Each has a different need, wants, and outlook in life.  If one between the partners paid a bigger share of the down payment or the monthly amortization and you want to be assured that this will turn into a bigger share of the property compared to the other person or partner, have it registered under the tenancy–in–common as per contribution to the property.

If a relationship runs a decade already then joint tenancy suits it to assure that the surviving owner has the assurance of having a place to live in and no need to transfer your share in a Will or if before you die. Sometimes a gift in a Will can be questioned by family members.

When a property is under joint names and the relationship didn’t work out, you are then stuck with the other person for a lifetime – either you buy your partner’s share, sell the property so you can divide the revenues.

If the relationship is just recent, the smart way to register the property with both of you is through the tenants–in–common to make the boundaries vivid, each one will know how much property he owns.

In this way if your relationship won’t work then there will be no confusion as to the percentage of property one should own or shouldn’t, this makes a legal side of splitting easier.  If the property is sold, the revenues will be divided per proportion of ownership.  If one partner or party wants to acquire the other partner’s share, he or she will be aware of the exact amount needed to separate him or her from the relationship and agreement in the property if breaking up happens.

 

Acquiring an Executive Condominium (EC) together

According to the HDB policies, two persons who are not married, a citizen of Singapore and over 35 years old can acquire together a newly build EC under JSS.

An EC is private property and only after  11 years it can be sold exclusively to Singaporeans only or PR  who are entitled to purchase an EC  within the 6 to 10 years and only allowed to be sold to foreigners after 11 years onwards.  An EC is the most advance and luxurious public housing and private property.  Considering that a new EC can only be bought by two single persons covered by the JSS, both names will be documented as owners and won’t have any issue that will arise where one person is recognized as the owner. Nonetheless, issues which are suitable in private property condition may be compatible to an EC because it has been privatized from the 11th year.