Loan Guides · Singapore
TDSR sounds like banking jargon — but it's the single most important number determining how much you can borrow in Singapore. Here's what it means, how it's calculated, and — crucially — how to work within it.
TDSR stands for Total Debt Servicing Ratio. It is a framework introduced by the Monetary Authority of Singapore (MAS) to ensure that borrowers don't take on more debt than they can realistically manage.
In plain English: TDSR limits how much of your monthly income can go toward repaying all your debts combined.
The TDSR framework has been adjusted over time, with the most recent change in December 2021 tightening the limit from 60% to 55% of gross monthly income. This means all your monthly debt repayments — mortgage, car loan, personal loans, credit cards — cannot exceed 55% of what you earn.
If you earn $10,000 a month, your total monthly debt repayments across all loans cannot exceed $5,500. That's your TDSR ceiling.
The formula is straightforward:
TDSR = (Total Monthly Debt Repayments ÷ Gross Monthly Income) × 100%
Must be 55% or below for a property loan to be approved.
There's one important catch: banks don't use the actual loan interest rate when stress-testing your TDSR. Banks must use a minimum interest rate of 4% (or the prevailing rate, whichever is higher) when calculating your loan eligibility. This means even if your actual mortgage rate is 3.2%, the bank calculates your repayment as if it were 4% — to ensure you can still afford it if rates rise.
Banks include all of the following when calculating your TDSR:
| Debt Type | Counted in TDSR? | Notes |
|---|---|---|
| Home loan / mortgage | ✅ Yes | Stress-tested at 4% p.a. minimum |
| Car loan | ✅ Yes | Full monthly repayment included |
| Personal loan | ✅ Yes | All outstanding personal loans |
| Credit card debt | ✅ Yes | 5% of outstanding balance counted monthly |
| Student loan | ✅ Yes | Monthly repayment amount |
| Business loan (personal guarantee) | ✅ Yes | If personally guaranteed |
| Overseas property loan | ✅ Yes | Included if declared |
| Renovation loan | ✅ Yes | Monthly repayment included |
Even if you pay your credit card in full every month, banks count 5% of your total credit card limit — not your actual spending — as a monthly debt obligation. A $30,000 combined credit card limit adds $1,500 to your monthly TDSR calculation. Reduce unused credit card limits before applying for a property loan.
Not all income is treated equally under TDSR. Only 70% of variable income (e.g., commissions, bonuses) is counted towards these ratios.
| Income Type | % Counted by Banks | Notes |
|---|---|---|
| Fixed salary | 100% | Full amount counted |
| Bonus / commission | 70% | Averaged over 12 months |
| Rental income | 70% | Must show tenancy agreement |
| Self-employed income | 70% | Based on 2-year NOA average |
| Freelance / gig income | 70% | Requires IRAS documentation |
| CPF contributions | 100% | Employer + employee combined |
| Overseas income | 70% | After haircut, converted to SGD |
This is why self-employed borrowers and commission-based earners often find their borrowing power lower than expected — even with strong actual earnings, only 70% counts toward TDSR.
James has a car loan ($1,200/month) and wants to buy a $1.5M condo.
At 4% stress test rate over 25 years, $5,400/month supports a loan of approximately $1.02M. With 25% down ($375K), James can afford the $1.5M condo — just within limits.
Linda wants a $600K equity cashout on her fully paid condo in Bishan.
Available for new loan: $3,575/month. However — because Linda's condo is fully paid and she only wants $600K (under 50% LTV), TDSR is exempt entirely. She qualifies without an income check.
Many Singaporeans confuse TDSR with MSR (Mortgage Servicing Ratio). They are different frameworks applying to different property types:
| Rule | Cap | Applies To | What It Covers |
|---|---|---|---|
| TDSR | 55% of gross income | All property loans | ALL debt repayments combined |
| MSR | 30% of gross income | HDB loans & EC loans only | Mortgage repayment only |
If you're buying an HDB flat or EC, both MSR and TDSR apply — and you must pass both. MSR is stricter (30% cap on just the mortgage), so it is usually the binding constraint for HDB buyers.
For private property buyers and equity cashout borrowers, only TDSR applies.
Here is the single most valuable piece of information in this entire guide: MAS provides a TDSR exemption for mortgage equity withdrawal loans where the total LTV stays at or below 50%.
In plain English: if you already own a private property and want to do an equity cashout — and you keep the total borrowing below 50% of the property's value — the bank does not need to assess your income against TDSR at all.
This exemption was designed for asset-rich, income-complex borrowers — retirees, business owners, self-employed individuals, those with irregular income. If your property is substantially paid down, you may be able to unlock hundreds of thousands in cash without an income stress test.
| Scenario | LTV | TDSR Check? | Income Critical? |
|---|---|---|---|
| Equity cashout keeping total LTV ≤ 50% | ≤ 50% | ❌ Exempt | No |
| Equity cashout pushing LTV 51%–75% | 51–75% | ✅ Required | Yes |
| New property purchase loan | Up to 75% | ✅ Required | Yes |
Structuring within the 50% LTV band is a deliberate strategy used by experienced borrowers — and one that a loan broker can help you calculate precisely before you apply. For more detail, see our guide on Property Equity Cashout in Singapore.
If your TDSR is too high to qualify for the loan you want, here are practical steps to improve it before applying:
TDSR assessment varies between banks. Different banks apply haircuts differently, treat overseas income differently, and have different internal policies on commission-based earners, business owners, and retirees. What gets rejected at one bank may be approved at another.
At VeFi, we assess your full financial profile first — before submitting to any bank. We identify which lenders are most likely to approve your application given your income structure, existing debts, and property position. Then we submit to the right bank, with the right documentation, structured correctly.
We work with all major Singapore banks including DBS, OCBC, UOB, Standard Chartered, Maybank, CIMB, and Hong Leong Finance — giving you the broadest possible set of options and the highest chance of approval.
Whether you're in Orchard, Jurong, Tampines, Woodlands, Sengkang, or anywhere else in Singapore — if you're unsure about your TDSR position, the fastest way to get clarity is a free assessment with our team.
Tell us your income, existing debts, and what you want to borrow — we'll give you a clear picture in 48 hours.