Parliament: 9 in 10 applications to defer property loan repayments approved

Of the approved applications, close to three quarter were for individuals seeking to defer their residential property loans.
Of the approved applications, close to three quarter were for individuals seeking to defer their residential property loans.ST PHOTO: LIM YAOHUI

SINGAPORE - About 90 per cent of the 38,900 applications received by banks to defer property loan repayments were approved as at end-August, revealed Senior Minister Tharman Shanmugaratnam in a written answer to MP Murali Pillai (Bukit Batok) in Parliament on Tuesday (Oct 6).

Of the approved applications, close to three-quarters, or about 26,000, were for individuals seeking to defer their residential property loans.

This amounted to almost $20 billion of deferments, said SM Tharman.

He added that banks have granted more than 8,100 conversions from outstanding loans to term loans as at end-August.

The outstanding amounts totalled more than $200 million, or about $25,000 per individual on average.

As for life and health insurance, Mr Tharman said banks received 32,700 applications for premium deferments, and about 90 per cent of them were approved as at end-August, amounting to about $66 million in premiums.

Similarly, about 90 per cent of about 1,300 applications for flexible instalment plans have been approved.

The option to defer loans and insurance premium payments was announced by the Monetary Authority of Singapore (MAS) on March 31, to ease the financial strain on individuals arising from the Covid-19 outbreak.

Applications for deferment opened on April 1 for insurers, and April 6 for banks.

The measures to help individuals included allowing them to defer either principal payment or both principal and interest payments on their residential property loans until Dec 31. Earlier this week, MAS said the relief measures will be extended to next year.

Interest will accrue only on the deferred principal amount, and no interest will be charged on the deferred interest payments, MAS said in March.

 
 
 

For the conversion of outstanding balances into term loans for unsecured loans, a reduced rate of interest was introduced, capped at 8 per cent. This is lower than the 26 per cent typically charged on credit cards, MAS had noted.

Customers of life and health insurance policies could also apply to their insurer to defer premium payments for up to six months while maintaining insurance coverage.

Premium deferment is available for all individual life and health insurance policies with a policy renewal or premium due date between April 1 and Sept 30.

The number of mortgage deferments from individuals has tapered off since the April to June peak: as of end-June, there were nearly 34,000 approved applications, MAS said on Monday.