Mortgage Servicing Ratio (MSR) Formula Explained, With Examples
Every mortgage servicing ratio (msr) result comes from one formula. Once you understand what goes into it, you can sanity-check any figure you are given, whether by an employer, a bank, a teacher or another website.
The formula
Maximum instalment = 30% × gross monthly income.
What each input means
- Gross monthly household income (S$): the value you enter in the calculator.
Example
For example, with these inputs:
- Gross monthly household income (S$): 9,000
the calculator returns:
- Maximum monthly instalment (30%): S$2,700.00
How the result changes
The table keeps the other inputs at their example values and changes gross monthly household income (s$).
| Gross monthly household income (S$) | Maximum monthly instalment (30%) |
|---|---|
| 9,000 | S$2,700.00 |
| 4,500 | S$1,350.00 |
| 6,750 | S$2,025.00 |
| 11,250 | S$3,375.00 |
| 13,500 | S$4,050.00 |
Why it matters
Property is the largest purchase most Singaporeans make, and stamp duties, loan limits and cash requirements are front-loaded. Small mistakes in these figures can mean a shortfall at completion, so it pays to run the numbers before you commit to an option to purchase.
Singapore's property market is shaped by cooling measures introduced since 2009, including Additional Buyer's Stamp Duty, loan-to-value limits and debt servicing ratios. These rules are adjusted when the market runs hot, so the numbers you see today may differ from what friends paid a few years ago.
The Total Debt Servicing Ratio limits monthly debt repayments to 55% of gross monthly income for any property loan, and the Mortgage Servicing Ratio limits the housing instalment to 30% of income for HDB flats and new executive condominiums. Banks apply a medium-term interest rate in these tests rather than the rate you will actually pay.
Beyond the price, buyers should budget for legal fees, valuation, home insurance, renovation and furnishing. Running the figures in advance helps you decide how much cash to hold back and whether a smaller loan or longer tenure makes more sense.
Related calculations
- Rental Yield Calculator: Measures the return from rent before and after costs such as property tax, maintenance fees and agent fees.
- Home Loan Refinancing Calculator: Compares your current mortgage with a new rate to show the monthly saving and how long switching costs take to recover.
- Property Downpayment Calculator: Splits the downpayment into cash and CPF and shows the remaining loan.
- Buyer's Stamp Duty (BSD) Calculator: Calculates Buyer's Stamp Duty on a Singapore residential property using the tiered rates from 1% to 6%.
Use the Mortgage Servicing Ratio (MSR) Calculator to plug in your own numbers.
Run your own numbers: Mortgage Servicing Ratio (MSR) Calculator