Age limit set by financial institutions, not MAS

We thank Mr Ong Khin Oon for his letter (Let banks decide on age cap for loan repayment: March 20).

Mr Ong said he was told that the Monetary Authority of Singapore (MAS) had set an age limit of 75 on borrowers.

MAS has not set any age limit on borrowers. Financial institutions may, however, do so based on their internal credit policies, or they may consider the age of the borrower as one of the factors in their credit assessments.

Mr Ong also said that the total debt servicing ratio (TDSR) would not apply to the housing loan of a property if the loan-to-value ratio does not exceed 50 per cent. This is not correct.

The adjustment to the TDSR rule that took effect on March 11 applies only to mortgage equity withdrawal loans, which are loans secured on existing properties.

This is to help individuals to monetise the equity in properties that they already own.

The change does not apply to housing loans for the purchase of a property.

Bey Mui Leng (Ms)

Director (Corporate Communications)

Monetary Authority of Singapore