What is the discharge of the CPF charge?
In Singapore, the government permits the use of CPF savings for the partial or full repayment of housing loans. When you apply for a CPF Charge, the Central Provident Fund Board (CPFB) grants approval for using CPF funds to redeem and discharge the existing mortgage.
CPF Charge represents the withdrawn amount from your CPF savings used for property payment.
Most Singaporeans have CPF Charges as they utilise CPF funds for their homes and are obligated to repay the CPF Charge upon selling the property.
How to discharge the CPF charge?
When a CPF charge is created upon purchasing a private property using CPF savings, discharging it involves refunding the utilised amount and accrued interest to your CPF account.
There are two methods to accomplish this:
- Voluntarily refunding the amount used to your CPF account. After the refund, you will need a lawyer’s assistance to lift the CPF charge on your property.
It’s important to note that you are responsible for any legal costs associated with this discharge.
If you’re 55 years or older and plan to withdraw your Retirement Account savings above the Basic Retirement Sum by pledging the property in the future, a new CPF charge will be lodged to secure the refund when the property is sold/transferred.
You will bear the cost of lodging this charge.
- Refunding the amount used to your CPF account when you sell the property. The discharge will be handled by the lawyers managing the sale transaction as part of the overall process.
