For 1 July to 30 September 2026, the HDB concessionary loan rate is 2.
60% a year. A useful monthly estimate multiplies the opening loan balance by 2. 60% and divides by 12; the remainder of the instalment reduces principal.
Read the quarter correctly
HDB publishes the concessionary rate by quarter. The 2.60% rate applies from 1 July to 30 September 2026 and is reviewed for the next quarter. Do not label the rate permanently fixed or infer a future quarter before HDB publishes it. (HDB housing loan interest-rate page)
Dividing 2.60% by 12 gives roughly 0.2167% per month. Multiplying that by the opening balance gives a planning estimate of the interest charged for that month. This is a model, not a replacement for the HDB loan statement, because exact posting dates and balance changes matter.
| Situation | What changes |
|---|---|
| Existing concessionary HDB loan | Use the current published HDB rate |
| Comparing with a bank package | Compare total cost and repricing risk, not only today’s rate |
| Making a partial capital repayment | Recalculate from the lower balance after posting |
| Instalment differs from a simple estimate | Use HDB’s statement because timing and daily balances can differ |
Separate interest and principal
The instalment first needs to cover the period’s interest. What remains reduces the outstanding principal, so the interest component generally falls as the balance falls. A flat instalment does not mean the same amount of interest is paid every month. (CPF Board quarterly rate release)
A partial repayment reduces the balance on which future interest is computed once the payment is posted. Compare the interest path before and after the payment and retain an emergency fund. Do not assume every dollar saved in future interest is immediately available as cash.
Example: On an opening balance of S$300,000, a worked monthly estimate is S$300,000 x 2.60% / 12 = S$650 interest. If the instalment is S$1,500, about S$850 reduces principal before any timing adjustments.
Understand the CPF link
The HDB concessionary rate is pegged 0.1 percentage point above the CPF Ordinary Account rate. CPF explains that the OA rate uses a bank-rate formula subject to a 2.5% floor. The current 2.60% therefore reflects the OA floor plus the 0.1-point peg, not a promotional home-loan quote.
A rough spreadsheet is excellent for spotting trends, but the account statement is the source for an actual charged amount and remaining term. Escalate a discrepancy with the exact statement period, opening balance, payment dates and transactions.
