HDB Ownership After Divorce: What Happens Next?
A divorce can be somewhat daunting for any couple particularly those who live in the Housing and Development Board (HDB) flats. While a divorce elsewhere around the world may be straightforward, it may transpose out to be a complicated process as the HDB is one of the most valuable assets owned by a couple. Regardless of the type of flat you own—DBSS, BTO, or EC the rules and regulations still apply.
It’s quite imperative that you should inform your divorce lawyer to make necessary queries to the HDB regarding your retention of the flat before filing the divorce. To determine whether the flat should be surrendered, retained, or sold, the process requires specific general procedures and edicts to be followed.
Is it a matrimonial asset?
According to section 112(10) of the Women’s Charter, a matrimonial asset is an asset owned by the couple while in the marriage, used by their children for various reasons or assets owned by the couple before the marriage but have been substantially improved or renovated during the marriage. If you acquired the flat during the marriage, it is a matrimonial asset.
However, if you acquired the flat before marriage, then it’s not a matrimonial asset unless you both used it by living in it or raising children in it or either of you made an improvement on the flat during the marriage.
Inherited or gifted flats are considered matrimonial only if they are connected to the above conditions irrespective of whether they were received before or after your marriage. If the flat isn’t matrimonial, it is fully accredited to whoever owns it, and only he or she can decide whether to sell or retain it.
Minimum Occupation Period (MOP)
If the flat has been considered to be a matrimonial asset, it will further be assessed to find out if it meets the Minimum Occupation Period (MOP). Note that this is the first criteria you must meet before the asset can be sold or transferred to the rightful owner. MOP is virtually five years and usually varies from the mode of purchase, the type of public housing, and whether it was purchased with or without the Central Provident Fund (CPF) Housing Grant.
If neither of the party meets the required criteria, none of you will be able to retain the flat but will have to surrender it to HDB. When selling the flat, HDB will need the following documents:
- Court order if any
- Interim Judgement and certificate of making Interim judgment final OR
- Deed for separation
Retain of HDB flat
Your divorce lawyer should check to establish whether you’re eligible to retain the flat especially if it is matrimonial or not. If it is a matrimonial asset and meets the Minimum Occupation Period (MOP), the court can order spouse to transfer share of the flat to the partner. The MOP conditions require that the flat should have been in use for at least five years for it to qualify for sale or either of the parties to retain the ownership. However, there are various circumstances under which a spouse can retain the HDB ownership including all the mortgage payments if they’re due.
- If there are children involved: If you are given the custody of the child or children, you can retain the HDB flat. Note that all conditions have to be met—the divorce must not be due to annulment or non-consummation of marriage.
- If you’re divorced without children: According to PKWA Divorce Team, you can still maintain the ownership under the basic Single Singapore Citizen Scheme (SSC) only if:
- You are a Singapore citizen
- You’re 35years and above
- Your flat was purchased in an open market without the CPF Housing Grant for family.
- If the names of any of the party’s parents are named: The party under which the names appear are eligible to retain ownership along with all the relevant financial capabilities as well as related responsibilities.
Selling of the HDB flat
If neither of you is qualified to keep the asset or you have successfully managed to maintain your HDB flat, you can then proceed to sell it. However, this can be done in two ways based on various circumstances:
- If the divorce is filed in less than five years since you acquired it, it means that your flat has not passed the Minimum Occupancy Period (MOP). In this case, the HDB flat will have to be returned to HDB, which will reimburse you according to the assessed market value of the asset.
- If the flat has passed the MOP, you may sell it on an open market and divide the proceeds.
HDB does not allow for deferred sale after the interregnum judgment for divorce has been made as the family nucleus has already ceased existing. The proceeds will be used to pay off the pending mortgage loan, before compensating CPF the amount used to buy the flat with the accumulated interest. The remaining amount will be then divided between the both of you based on the instructions of the Family Justice Court (FJC).
In both ways, the flat can only be disposed of if the following regulations are met:
- The divorce is fiancé and fiancée
- The marriage is legally annulled
- The marriage was not consummated
Division of matrimonial assets
The HDB flat may be one of the most significant assets a couple could own, and in many cases, a division of the sale proceeds may be required. It is quite critical to understand that sometimes the division may not be equal. It should also be noted that you cannot claim or show interest in an asset owned by your spouse just because you were both married. Division of assets ultimately depends on the following factors as stated in section 112(2) of the Women’s Charter:
- Individual contributions concerning money
- Any debt incurred by either party in acquiring the flat
- Length of the marriage
- Individual contributions in the marriage for the benefit of the family
- Any agreement made between both parties regarding the ownership and division of the asset
The above factors cannot be exhausted. The court must take all considerations of the case into account and divide the proceeds from the sale of the HDB flat equitably.
Here are some other interesting articles you should check out: