If you are a regular contributor to your RSA, you can access up to 25% of the total amount you have saved up.

The National Pension Commission (PenCom) recently released a guideline which specifies the process for RSA Account Holders to access these funds as part of their equity contribution for their mortgage loan.

These guidelines are in line with the provisions of Section 89 (2) of the Pension Reform Act (PRA 2014)

According to PenCom, when applying for a mortgage, you can use up to 25% of your retirement savings (RSA balance) as your equity contribution. This applies regardless of the amount of equity the mortgage lender asks for.

Here's how it works:

1. If 25% of your RSA balance is more than what the mortgage lender requires, you can only use the amount needed by the lender.

2. If 25% of your RSA balance is less than what the lender needs, you must make up the difference with the lender before using the 25% as your equity contribution.

Eligibility Criteria

1. Employment Status: Applicants must be actively employed, either as salaried employees or self-employed individuals. Proxy applications are not allowed; applicants must apply in person.

2. RSA Data Recapture: If registered before July 1, 2019, applicants must have updated their records through the RSA data recapture exercise.

3. One-Time Access: For residential mortgage equity contributions, RSA holders can access their RSA balance only once.

4. Property Offer Letter: Applicants must possess a property Offer Letter, signed by the property owner and verified by the Mortgage Lender.

5. Contribution Period: To access their RSA balance for equity contribution, applicants must have both employer and employee mandatory contributions for at least 60 months. Voluntary Contribution (VC) can also be used, following the Voluntary Contribution Guidelines under the CPS.

6. Micro Pension Contributors: Micro Pension Contributors are eligible if they've made contributions for a minimum of 60 months before applying.

7. Previous Access: RSA holders who accessed their RSA balances due to job loss before these guidelines were issued can access their RSAs if they received contributions for at least 60 months from the first contribution date.

8. Job Loss Benefit: RSA holders who've used 25% of their RSA balance for equity contribution can also access 25% of their RSA for job loss, as per Section 7(2) of PRA 2014.

9. Near Retirement: RSA holders with less than 3 years to retirement are not eligible for using their RSA balances as equity contributions for residential mortgages.

10. Excluded Categories: Existing retirees under CPS and individuals exempted under PRA 2014 cannot use their RSA balances for equity contributions.

11. Joint Applications: Married RSA holders can apply jointly, but each must individually meet the eligibility requirements.

How To Apply For 25% Of Your RSA For Your Equity Contribution To Your Mortgage

1. Get the Property Offer Letter: First, get a property offer letter from the property owner or their approved agent. Then, approach a Mortgage Lender.

2. Fill Out the Mortgage Application: Complete a mortgage application provided by the Mortgage Lender. It will ask for basic information like your full name, PIN, Mortgage Lender's name, property value, etc.

3. Confirm Property with Your PFA: Once the Mortgage Lender verifies the property, go to your Pension Fund Administrator (PFA) and request your RSA Statement to access 25% of your RSA balance for the equity contribution. In a joint application, both parties should contact their respective PFAs with copies of the property offer letter.

4. Get Your RSA Statement: The PFA will provide you with an RSA statement, which you share with your Mortgage Lender. They will update the record for your equity contribution application.

5. Mortgage Lender's Verification: The Mortgage Lender checks if 25% of your RSA balance covers the equity contribution. If it does, they issue a mortgage offer letter. If not, they ask for additional equity contribution.

6. Receive Mortgage Offer: After confirming the supplementary equity contribution payment, the Mortgage Lender sends you a mortgage offer.

7. Notify Your PFA: The Mortgage Lender informs your PFA within two working days of sending you the mortgage offer and provides additional information.

8. Request Payment from Your PFA: Two working days after receiving your mortgage offer, ask your PFA for your Equity Contribution for the Residential Mortgage.

9. Submit Application Form: Complete an application form with an indemnity to your PFA for the equity contribution. In a joint application, both parties apply to their respective PFAs with the mortgage offer letter.

10. PFA Reviews the Application: Your PFA checks the application and supporting documents for completeness using a checklist within two working days.

11. PFA Updates Mandate File: Upon successful review, your PFA updates your Mandate File within two working days. Any exceptions or discrepancies found are communicated to the Mortgage Lender within two working days.

12. Validation of Requested Amount: Your PFA calculates and confirms that the requested amount is within 25% of your RSA Balance.

13. PFA Processes and Forwards: Your PFA processes the application and sends it to the Commission within two working days after a successful documentation review. You await approval and notification of the equity contribution.

H28 is an app that takes all the stress of planning to buy a home out of your hands. Including helping you access the RSA 25% balance.

From saving towards your downpayment, registering for NHF, and accessing other forms of housing finance tailored to your income, we make it simple for you to move into your own home.

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