WHAT HAPPENS TO YOUR HDB FLAT IN A DIVORCE?
Most married couples in Singapore start their marriage journey with the purchase of a HDB flat. This property is also likely one of their largest assets and the most complicated to deal with, considering the numerous CPF and HDB regulations governing it. This article explains several questions that divorcing couples tend to ask about their HDB flat:
- Can I still keep my HDB flat after a divorce?
- If I cannot keep the HDB flat, can I sell it to another person?
.CAN I STILL KEEP MY HDB FLAT AFTER A DIVORCE?
After a divorce, even if your spouse agreed/was ordered by the court to transfer their interest in the HDB flat to you so that you hold the property solely, this does not mean that you will automatically be able to keep the HDB flat. You may only do so if you fulfil HDB’s eligibility conditions. We discuss below 2 scenarios in which you may be allowed to retain the HDB flat.
Scenario 1: There are children to the marriage, and you have been granted care and control of them
One of the HDB’s eligibility criteria for retaining the HDB flat is that one must have a family nucleus. To have a family nucleus, the Court must have granted you care and control of your children. Two other conditions that must be fulfilled for you to be allowed to keep the flat include:
- You are financially able to take on the payment of the home loan for the HDB flat; and
- The divorce must not be due to the non-consummation of marriage or have been annulled.
Scenario 2: There are no children to the marriage, and you are eligible under the Single Singaporean Citizen Scheme
Even if you do not have children to the marriage, you may retain the HDB flat under the Single Singaporean Citizen (SSC) Scheme if:
- You are a Singapore citizen;
- You are at least 35 years old; and
- Your matrimonial flat is a resale flat purchased from the open market without the CPF Housing Grant for Family.
However, if your matrimonial flat was bought directly from HDB or was a resale flat bought with the CPF Housing Grant for Family, the 5-year Minimum Occupation Period (MOP) must be satisfied before you can retain the flat under the SSC Scheme. If you cannot fulfil the MOP, it is still possible to include another person to keep the flat with. Still, the approval of this arrangement would be subject to HDB’s prevailing eligibility conditions and schemes.
IF I CANNOT KEEP MY HDB FLAT, CAN I SELL IT IN THE OPEN MARKET?
If you find that you do not satisfy any of the conditions discussed above, you will not be allowed to keep your HDB flat and will have to dispose of it when you get divorced.
Scenario 1: The 5-year MOP is not satisfied
If you get divorced before the MOP is completed, the flat will have to be returned to HDB at the prevailing compensation price, subject to HDB’s approval. However, parties can appeal to HDB to sell the flat in the open market even though the MOP is not yet reached. HDB will consider such appeals on a case-by-case basis. If the appeal is successful, the parties may sell the HDB flat in the open market. Another possibility is simply for parties to wait for the 5-year MOP to pass before obtaining the divorce if they believe that doing so makes greater financial sense. The marriage relationship is not so acrimonious that obtaining a divorce is urgent.
Scenario 2: The 5-year MOP is satisfied
If you and your spouse can meet the MOP, you will be allowed to sell the HDB flat in the open market. The sale proceeds will first go toward the repayment of any outstanding mortgage loans and the reimbursement of CPF monies used to finance the HDB flat’s purchase with accrued interest. As for the remaining sale proceeds, there are 2 ways for parties to decide how the balance should be divided between parties and in what proportions. The first is if parties can come to a mutual agreement, they can jointly decide on what proportions the HDB flat should be divided and dealt with. However, if the parties find that they cannot reach a mutual agreement, they can leave it to the Court to decide how the HDB flat should be divided in a just and equitable manner.
ABOUT PKWA FAMILY LAW.
At PKWA Law, our team of Family Lawyers are consistently named as leading Singapore family and divorce lawyers by respected legal publications such as Benchmark Litigation Asia Pacific, Asian Legal Business, Singapore Business Review and Doyle’s Guide to Leading Singapore Family & Divorce Lawyers. Contact us at tel 6854-5336 for a free first consultation.