What’s an Approval-in-Principle (AIP) and Why It Matters?
If you're planning to buy a property in Singapore — whether it's your first home or your next investment — one of the first and most important steps you should take is getting an Approval-in-Principle (AIP) from a bank.
But what exactly is an AIP, and why is it so crucial? Let’s break it down.
What is an AIP?
An Approval-in-Principle is a non-binding document issued by a bank that states how much you can potentially borrow for a property purchase, based on your income, credit profile, and existing liabilities.
Think of it as a “green light” from the bank, giving you clarity on your loan eligibility before you commit to any property.
Why Getting an AIP Matters
Know Your Budget Before You Shop
Avoid disappointment. An AIP gives you a clear idea of what price range you can afford, so you don’t waste time viewing properties outside your loan capacity.Gives You Negotiating Power
With an AIP in hand, sellers and agents take you more seriously. It shows you’re financially prepared and ready to make a move.Prevents Loan Rejection Later
One of the worst things that can happen is putting down an Option Fee, only to find your loan application rejected. An AIP minimizes that risk.Speeds Up the Buying Process
With your AIP ready, you can act quickly on good opportunities — especially important in a competitive market or ballot-based new launch.No Obligation to Take the Loan
Just because you get an AIP from one bank doesn’t mean you must take the final loan with them. You’re free to compare rates when the time comes.
When Should You Apply for an AIP?
✅ Before you start house hunting
✅ Before you commit to any Option to Purchase (OTP)
✅ Especially important if you’re upgrading, buying with CPF, or have existing loans
Final Word
An AIP is free, fast, and could save you thousands in mistakes. If you're even thinking about buying a property, getting an AIP should be your first step.
Need help getting your AIP done or unsure how much loan you’re eligible for?
📞 Reach out — I can connect you with a banker and guide you through the process.
