Government mulling reverse mortgage for elderly S’poreans

Government mulling reverse mortgage for elderly S’poreans

Scheme will allow elderly to borrow against the value of their home; repayments are only made after the borrower dies or the house is sold

BY XUE JIANYUE
PUBLISHED: MARCH 10, 4:59 PM UPDATED: MARCH 10, 5:00 PM

SINGAPORE — The Government is revisiting reverse mortgage as a means to help elderly Singaporeans retire comfortably, said National Development Minister Khaw Boon Wan in Parliament today (March 10).

Speaking at the Committee of Supply debate for the Ministry of National Development (MND), Mr Khaw said some elderly Singaporeans at Our Singapore Conversation had suggested that the Government offer Reverse Mortgages (RM) to them. They also expressed their wish to age-in-place — living in a residence of their choice — and retain an asset which they can bequeath.

Mr Khaw also said the ministry is reviewing the Enhanced Lease Buyback scheme to see if it can be extended to larger flat types, as suggested by several Members of Parliament (MPs).

RM loans were given for public housing in 2006 with NTUC Income selling RM products to Singaporeans at age 70. The scheme stops at age 90 or when the homeowner dies. Such mortgages allow homeowners to borrow money against the value of their homes. Unlike a normal mortgage, there is no repayment of a reverse mortgage until the borrower dies or the home is sold, thus unlocking equity for homeowners.

Although the scheme did not quite take off, Mr Khaw said it is timely to revisit this option as the MND already has a better understanding of the elderly’s preferences after some experience with the Silver Housing Bonus and Lease Buyback.

This year, there were 27 “cuts” — a call for a S$100 reduction in a ministry’s budget — for the MND compared to 40 “cuts” last year.

Among the MPs who rose to express their views about MND’s programmes, MP (Nee Soon GRC) Lee Bee Wah suggested that the ministry remove all forms of waiting period for divorcees with children. MP (Marine Parade GRC) Seah Kian Peng suggested that the ministry seek the local Community Development Council’s inputs when evaluating an applicant’s housing needs.

Mr Khaw said the Government has begun to focus on vulnerable groups, especially for divorcees with children, given that the backlog for newlyweds have been cleared. The ministry will study Dr Lee’s and Mr Seah’s suggestions, he said, adding that the authorities will continue to exercise flexibility and compassion whenever they receive worthy cases from MPs.




- wong chee tat :)