HDB Contra Facility Guide for Second-Time HDB Buyers

Planning for a bigger HDB home as your family grows? Then the HDB Contra Facility is worth reading up on. In this guide, we will show you the benefits as well as the limitations of the HDB contra facilities for second-time HDB flat buyers.


What is HDB Contra?

The HDB Contra Payment Facility is basically a scheme that helps existing flat owners to easily transition (financially) from the sale of their existing HDB flat to the purchase of the resale one. It is also called the HDB Enhanced Contra Facility

(Note: If you’re buying a new flat directly from HDB for the second time, there is also a contra payment facility. This guide will focus on the enhanced contra facility for resale flats.) 

With the HDB contra facility, you can offset the cost of your upcoming HDB flat purchase with the proceeds from the existing home that you are selling. 


How Does HDB Contra Facility Work?

While the HDB contra facility may sound complicated, the concept behind it is easy to understand. Here’s an example: 

  • Say you have an existing 4-room flat that you are selling to a buyer (John).
  • At the same time, you are eyeing a 5-room flat that Peter is selling. 
  • When you apply for HDB ECF, the sales proceeds (cash and refunded CPF money) from your 4-room flat (that was sold to John) will be channelled into the 5-room flat you are buying from Peter. 

Searching for your dream home? Use PropertyGuru to find your ideal resale flat.


HDB Contra Facility Benefits 

There are two key benefits of the HDB contra scheme.  

Firstly, it helps to reduce the cash you need to fork out for your new HDB resale flat. That’s because proceeds from the sale of your existing home will be used to pay for the cash portion of your resale home purchase.

Next, the cash proceeds and refunded CPF money will also help to reduce the mortgage that you need to pay for your new resale home. This helps to reduce the monthly repayment that you need to fork out for your home loan.


What to Take Note of When Applying for the HDB Contra Facility 

While the HDB contra facility is useful, it is not without its limitations. Here are some things to note:

  1. The CPF refunded money from the sale of your existing home can’t be used to pay fees like the stamp duty and conveyancing costs. There are also qualifying criteria that need to be met before you can apply for the HDB contra facility.
  2. Since there are many parties and two transactions, it can also be slightly more tedious to coordinate. A misstep in any part of the deal means that the whole deal can fall through. 
  3. Finally, if you apply for HDB contra, you will need to take up an HDB home loan. Considering that interest rate on bank home loans could be lower than HDB housing loan, you might end up paying for higher interest rate charges on your mortgage.

Compare HDB housing loan against bank home loan rates on PropertyGuru Finance.


HDB Contra Facility Eligibility Criteria 

There are a couple of conditions that you need to fulfil before you are eligible for the HDB contra facility:

  1. The buyer of your existing flat AND the seller of the resale flat you are buying must not have applied for similar contra facilities for their flats.
  2. If you and your spouse are both PRs, neither of you can be an undischarged bankrupt or have any bankruptcy proceedings against any of you.
  3. The sale of your existing flat needs to be completed before or latest on the same day as the completion of your purchase of the new resale flat.
  4. You cannot apply for HDB enhanced contra facility if you are taking a home loan from the bank. Similarly, if the resale flat you are planning to purchase is also under a bank home loan (and not an HDB housing loan), you also won’t qualify.

How to Apply for HDB Contra Facility for Resale Flats

For those who are interested to apply for the HDB contra facility, it’s very simple. All you need to do is to opt for the HDB enhanced contra facility option when you are submitting your Resale Application.

HDB Enhanced Contra Facility (ECF) 1

Source: HDB


If you are planning to buy a resale flat through HDB’s resale portal, you (and the seller) will submit a Resale Application form on the portal. In your Resale Application form as the buyer, you need to indicate that you are opting for HDB enhanced contra facility. 

In case you read this guide after you submitted your Resale Application form, there’s still time to salvage the situation. You can download the “Application for Enhanced Contra Facility” form on HDB website. Then just fill it up and submit it to HDB via fax, post, email or in-person at the HDB Resale Office (at HDB Hub).

Read PropertyGuru’s Complete Guide to Paying For A Resale Flat in Singapore to find out more about how to buy your resale flat using the HDB resale portal.


HDB Enhanced Contra Facility (ECF) 2

Source: HDB


If you are engaging a property agent to buy the resale flat, your property agent will need to help you opt for HDB ECF when he/she submits the Resale Application form via the Estate Agent Toolkit

Similarly, if your property agent forgot to indicate your choice for HDB ECF, or it slipped your mind to inform your property agent about your choice for HDB ECF, you can also change your preference using the “Application for Enhanced Contra Facility” form.


HDB Enhanced Contra Facility (ECF) 3

Source: HDB


Your agent can also submit the Resale Application form on your behalf through the HDB e-Resale portal and indicate that you want to opt-in for HDB ECF.


If you’re keen on buying an HDB resale flat, be sure to check out our step-by-step guide to buying an HDB in Singapore.

Still looking for your dream HDB home? Check out PropertyGuru’s latest listings here for HDBs on sale in Singapore.

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