TDSR and MSR in Singapore: What Every Borrower Must Know
Before a Singapore bank or HDB approves your home loan, your income goes through two regulatory filters that determine how much you can actually borrow — the Total Debt Servicing Ratio (TDSR) and the Mortgage Servicing Ratio (MSR). Understanding both can save you from nasty surprises on the day you want to exercise your Option to Purchase.
What Is TDSR?
The Total Debt Servicing Ratio is a MAS-mandated rule that caps the total monthly debt obligations a borrower can carry as a proportion of gross monthly income. Under TDSR, all your existing and new debt repayments — home loan, car loan, student loan, credit card minimum sums, personal loans, and any other credit facilities — are added together. That combined figure must not exceed the TDSR threshold set by MAS.
As a widely-known rule, the TDSR threshold currently stands at 55% of gross monthly income. Always verify the current figure with MAS or your bank, as cooling measures can adjust this threshold. For context on how cooling measures have shaped borrowing rules over the years, see Singapore Property Cooling Measures: What They Are and Why They Matter.
What counts as a debt obligation?
- The instalment on the property loan you are applying for
- Outstanding car or vehicle loan repayments
- Renovation or personal loan repayments
- Credit card minimum monthly repayments (typically a percentage of the outstanding balance)
- Student loans and other credit facilities
If you are applying with a co-borrower (for example, a spouse), the combined gross income of all borrowers is used, as are all their combined debts.
What Is MSR?
The Mortgage Servicing Ratio applies specifically to HDB flats and Executive Condominiums (ECs) purchased directly from a developer. It is a tighter, narrower rule: the monthly repayment on the property loan itself must not exceed a fixed percentage of the borrower's gross monthly income.
The MSR cap is 30% of gross monthly income — a well-established figure, but again verify with HDB or your bank since policy can change. Note that the MSR considers only the mortgage repayment for that HDB or EC loan, not your total debt picture. However, the TDSR rule still applies on top of MSR; both must be satisfied simultaneously.
When does MSR apply?
| Property Type | MSR Applies? | TDSR Applies? |
|---|---|---|
| HDB flat (HDB loan or bank loan) | Yes | Yes |
| EC bought from developer | Yes |
よくある質問
- What is the TDSR limit in Singapore and what debts does it include?
- The Total Debt Servicing Ratio (TDSR) caps a borrower's total monthly debt repayments — including the new home loan, car loans, personal loans, and credit card minimums — at 55% of gross monthly income, as set by MAS. This rule applies to all property types in Singapore. Always verify the current threshold with MAS or your bank, as it can be adjusted by policy changes.
- What is the MSR and when does it apply?
- The Mortgage Servicing Ratio (MSR) limits the monthly repayment on a housing loan to 30% of gross monthly income, and it applies specifically to HDB flat purchases and Executive Condominiums bought directly from a developer. It does not apply to private condominiums or resale ECs after privatisation. Both MSR and TDSR must be satisfied at the same time when buying an HDB flat or new EC.
- Does the MSR apply if I take an HDB loan instead of a bank loan?
- Yes, the 30% MSR cap applies regardless of whether you use an HDB concessionary loan or a bank loan to buy an HDB flat. The type of lender does not change the MSR requirement, which is a MAS regulation that governs all residential property loans for HDB flats and new ECs in Singapore.
- Why does the bank use a higher interest rate than the actual rate when computing my TDSR?
- MAS requires banks to stress-test borrowers using a minimum medium-term interest rate floor that is typically higher than the prevailing market rate, to ensure borrowers can still service their loans if rates rise. This means your qualifying loan quantum is calculated at a notional higher rate, so the amount you can borrow is lower than if the actual market rate were used. Check with your bank for the specific floor rate currently applied.
- Can I improve my TDSR headroom before applying for a property loan?
- Yes — paying off or reducing existing debts such as personal loans, renovation loans, or car loans before applying will lower your total monthly debt obligations, freeing up more TDSR headroom for your home loan. Avoiding new credit facilities in the months before your application also helps. Getting an In-Principle Approval (IPA) from a bank early will show you your exact borrowing capacity before you commit to any property purchase.