🏡📉 Mortgage rates may be falling, but that doesn't necessarily mean you can borrow more.
This is something many property buyers misunderstand.
You might see a home loan package at 1.5% or 2% and assume your maximum loan amount will increase.
But banks don't assess your loan eligibility based only on today's promotional interest rate.
For residential property loans, the TDSR assessment is generally stress-tested at a minimum interest rate of 4% p.a. or the applicable thereafter rate, whichever is higher. The TDSR cap also remains at 55% of gross monthly income.
So even if your actual monthly instalment is lower today, your maximum loan quantum may remain largely unchanged.
Think of it this way:
📉 Lower actual rates = Lower monthly repayment and better cash flow
📊 4% stress test = Your loan eligibility is still assessed conservatively
🏦 TDSR at 55% = Your total debt obligations still affect how much you can borrow
💰 LTV limits = Your property value can also cap your maximum loan
The good news?
Lower interest rates can still make a meaningful difference to your monthly cash flow after you purchase.
But they are not a licence to increase your property budget based purely on what today's mortgage rate looks like.
🔗 https://propertynet.sg/mortgage-stress-test-2026-why-low-rates-dont-raise-loan-limit/
📌 Don't just ask, "How low is the interest rate?"
Ask:
"Can I still comfortably afford this property if the interest rate goes back up?"
That's a much better stress test for your next property decision.
PropertyNet.SG
Singapore Mortgage Stress Test 2026: Why 1.4% Rates Still Cap Your Loan at 4% | PropertyNet.SG
Mortgage rates have fallen near 1.4% in 2026, but MAS still stress-tests loans at 4%. Here is why cheap money does not raise your borrowing limit.
September 1, 2026 67 1
