I WONDER how many Singaporeans are aware they cannot use their CPF savings to pay their housing loan fully.
I did not realise this until I received a letter from the authorities earlier this month which said we could not withdraw more CPF funds to pay for our flat.
Thus, the balance had to be serviced in cash even though we still make monthly CPF contributions.
The reason given by the CPF Board is as follows (quoted from a letter sent to us after repeated appeals to the CPF Board via our MP):
'The primary objective of CPF is to help members save for old age. We must balance the home ownership objective with the retirement objective. This is done by capping the withdrawal of CPF for a property up to the Valuation Limit (VL), that is the purchase price of the property. Once members have withdrawn their CPF up to the VL, they can only withdraw further CPF if they can set aside Minimum Sum cash component in their CPF Special and Ordinary accounts, this amounts to $120,000.'
Can an exception be made for young couples like us who have many other commitments - young children, aged retired parents - and as a result are not cash-rich at present.
What is more, we have many more years to save towards retirement.
Can we therefore be allowed to service our housing loan fully via CPF, given that this is our first flat?
