Man Clear BTO in Less Than 7 Years, Save Tens of Thousands in Interest Just by Doing This
In Singapore, many couples slog for decades just to pay off their HDB BTO home loan. But one savvy homeowner managed to clear his $400,000 housing loan in less than 7 years — and he’s sharing how he did it. No inheritance, no toto winnings, just clever planning, discipline, and a strong strategy using CPF surplus and an annual $20,000 cash top-up.
Now, most Singaporeans will choose the standard 25-year loan tenure, thinking it’s manageable and gives them more flexibility. But what they don’t realise is, they end up paying a lot more interest over the years. This man did the maths, and with his aggressive repayment method, he managed to slash years off his loan and save tens of thousands in interest. Here’s how he made it work — and why it might be something worth considering if you want to be debt-free earlier too.
The investment & Loan Balance
Wah, you know this guy damn solid lah.
He say he no need to wait 25 years to clear his HDB loan — he finish paying everything in less than 7 years. All by using a bit of brain and discipline. No need strike Toto also can one. To avoid retrenchment risk or when he becomes too old to work.
So here’s how he do it:
He and his wife take $400,000 loan from HDB for their BTO flat, 25-year tenure. Monthly repayment using CPF OA, like most people. But hor, every year without fail, he make two extra moves:
- Use CPF OA surplus to make lump-sum repayment
- Top up $20,000 cash annually towards the loan
He say, “Every year bonus come, or got angbao money, I don’t anyhow spend. I put into the house.” Wah, steady lah.
You might think like that very siong, but the guy calculate liao — the numbers make sense.
If just follow standard 25-year plan with 2.6% HDB interest, total interest paid is around $145,000.
But because he pay down fast fast — principal go down faster, interest snowball less — he estimate he only paid around $35,000 to $40,000 in interest in total.
Means he save almost $100,000 in interest leh. No joke.
Some more, now he stay in a fully-paid HDB at age 35. Don’t need worry about mortgage liao. Just need pay conservancy charges and maybe property tax nia.
He say, “Every month I still got CPF going in. Can slowly rebuild OA. Later want upgrade to condo also easier.”
Moral of the story? If you got discipline and don’t use CPF OA to buy nonsense insurance or what, just use it to whack the loan — you can be debt-free before 40.
Just need patience and commitment.