Provident fund loans are everyone’s first choice when borrowing money. This loan method can save money and be more convenient, but everyone must pay attention to that provident fund loans are not a panacea! Let me take a closer look at the seven common misunderstandings about provident fund loans. Attached is a comprehensive guide on provident fund withdrawal and loans to help you solve various doubts in the use of provident fund.

Myth 1: House purchase loans cannot exceed the upper limit of the provident fund amount

Provident fund loans can save money and be more convenient, but everyone should know that the loan limit of provident fund loans is different from commercial loans.

Commercial loans are based on the assessment of the lender's ability to repay the loan. If the assessment passes, basically all loan lines except the down payment can be granted; provident fund loan lines are issued based on the lender's The loan amount is calculated based on income, monthly provident fund amount and payment ratio, not just the property value. For example, your provident fund loan limit can only be 550,000, and you need a loan of 600,000 to buy a house. If you use a provident fund loan, you can only get a loan of 550,000. With a commercial bank loan, if you pass the assessment, you can get a loan of 600,000.

Myth 2: The balance in the provident fund account cannot be used as the down payment for buying a house

Many people think that the provident fund can be used to pay the down payment for buying a house, but this is not true. Because the provident fund can be withdrawn after being used first, that is to say, the home buyer can only go through the withdrawal procedures after providing proof materials related to the purchase of the house.

Myth 3: The provident fund cannot be withdrawn for house decoration

The provident fund can be withdrawn and used by employees when they purchase, construct, renovate, or overhaul their own homes (the maintenance cost exceeds the cost of the house by more than 30 yuan) And set the benefits.

Although decoration is also part of the house, it is not within the scope of withdrawal and use of provident fund, so the provident fund cannot be withdrawn and used. Before using the provident fund, you must understand the purpose of the provident fund and use it selectively and purposefully. Otherwise, you may find yourself unable to withdraw the provident fund after renovating your house with insufficient funds, causing yourself a dilemma.

Myth 4: Children cannot use their parents’ provident fund to buy a house

In terms of housing provident fund loan application for house purchase, children and parents each have their own accounts, and they are separate. , so children cannot use their parents’ provident funds to borrow money to buy a house.

The subject of the provident fund loan must be the same as the subject who signed the house purchase contract and applied for the house purchase loan. Furthermore, although parents and children are one family, and parents will definitely give their children a certain amount of financial support when buying a house, they are separate when it comes to provident fund loans. If the child does not have a provident fund, he cannot apply for a provident fund loan.

Myth 5: Provident fund withdrawal cannot exceed the total house payment

According to the principle of using provident fund first and withdrawing later, after the lender completes the loan, when withdrawing provident fund, the withdrawal amount shall be based on The loan amount is determined by the total price of the house.

Generally speaking, if the amount of provident fund that can be withdrawn is 500,000, and the home buyer's loan limit or the total price of the house is 300,000, then you can only withdraw 300,000, and the remaining 200,000 in the provident fund account is cannot be extracted. It can only continue to be placed in the account for future loans to buy a house, and can be used during house construction, renovation, and overhaul. It cannot be used as your working capital.

Myth 6: Unmarried couples cannot apply for a provident fund loan to buy a house together

A provident fund loan is a family-based loan. Spouses, parents and children can all participate in the loan with the primary lender. However, male and female friends cannot handle loan procedures at the same time.

Myth 7: Withdrawing provident fund by renting a house does not mean that you can withdraw as much as you rent

Withdrawing provident fund by renting a house does not mean that you can withdraw as much as you rent. The amount of provident fund withdrawal cannot exceed the actual expenses incurred, and some cities have stipulated an upper limit on the monthly withdrawal amount. Therefore, friends who plan to withdraw provident funds to pay rent are best to consult the local provident fund center to understand the rental withdrawal limit and prepare in advance.