UOB head of secured loans (personal financial services) Chia Siew Cheng was reported by TODAY as saying that the bank’s latest home loan product was developed “to help younger executives afford their first home”. According to Ms. Chia, the bank has observed many young couples in their late 20s to early 30s seriously looking to buy a HDB or a private residential property for owner-occupation. Ms. Chia also added that the bank has been transparent with applicants that the longer repayment period and loan tenor also mean that more interest will be payable over the period of the loan.
UOB’s statement comes in response to Minister for National Development Khaw Boon Wan criticism of the offer of 50-year housing loans as a “gimmick”. Minister Khaw was quoted yesterday at the sidelines of a National Day observance ceremony in Woodlands.
Last month, The Straits Times reported that the bank started offering home loans of up to 50 years, which is possibly the longest term loan currently available in the local market. Previously, other banks had offered home loans that span up to 40 years.
United Overseas Bank (UOB) has also clarified that loan applications are processed and approved at its head office and not at showflats, and that the new service was only meant to assess home buyers’ eligibility for home loans at selected showflats.
The bank issued this statement last Friday to clarify its loan application process after the launch of its new service last Wednesday where its mortgage brokers are issued with iPads, which are connected to its credit evaluation system. The bank had earlier been reported as saying that this would make the home loan approval process easier and potential home buyers at showflats would be able to know on the spot if their home loan application have been approved.