CPF loss/ Bank Loss

An Anonymous comment

"I believe there is a fundamental flaw in yr presentation. I will be very disturbed if yr inf is correct.
.
Enbloc price: S$395 mil / 560 units = S$705k on average
Beta sum: S$10 mil / 560 units = S$18k (assuming no claim)
Total proceeds from enbloc = S$723k

Each SP will receive S$723k more or less. The buyer will not pay you one single cent more, becos total sales px is S$405 mil.
Regardless the order of charge, there will be financial loss; it is either a cash loss or a CPF loss.
Illustration:Buy px S$580k O/s bank loan S$300kCPF refund S$500k



1. Bank 1st charge CPF 2nd charge Enbloc proceeds S$723k - bank loan S$300k - CPF refund S$500k = CPF loss -S$77k (need not top up)

2. CPF 1st charge Bank 2nd chargeEnbloc proceeds S$723k - CPF refund S$500k - bank loan S$300k = Cash loss -S$77k (must settle b4 bank discharge)

Personally, I feel CPF 2nd charge is more relevant in today context. It afford owner the option to downgrade without topping up CPF loss, which is not the case in CPF 1st charge becos one hv to settle loan shortfall....remember the aftermath of 97 crisis when many pple were trapped in negative equity situation and were forced to continue with heavy servicing burden as they cant afford to settle loan shortfall.

Hence, the real life example you quoted in TC:-

"Blk 130 – Buy price $605k – CPF 1st charge a whopping $949,583 – no outstanding bank loan!!"

is highly unlikely as enbloc proceeds is S$723k only, instead of gain he will suffer CPF loss.
If my understanding on above is correct, I hope you will keep your original posting but add on my findings for readers' benefit "

I will answer sometime today....