What is the CPF accrued interest and how does it affect me when I sell my property?
CPF accrued interest is the interest your CPF Ordinary Account savings would have earned had they not been used for your property purchase, calculated at 2.5% per annum compounded monthly. When you sell your property, you must refund both the principal CPF amount used and all accrued interest back to your CPF OA before receiving any cash proceeds. If sale proceeds are insufficient to cover the full refund, you only need to return up to the net proceeds — you are not required to top up the shortfall from other funds.
Last updated: 22 Apr 2026
CPF accrued interest is the interest that your CPF Ordinary Account savings would have earned if they had not been withdrawn for your property purchase. When you sell your property, you are required to refund the principal CPF amount used plus all accrued interest back to your CPF OA before you can pocket any cash proceeds.
The accrued interest is calculated at the CPF OA interest rate, currently 2.5% per annum, compounded monthly. It starts accumulating from the date of each CPF withdrawal - whether for the downpayment, stamp duties, or monthly instalments - until the date of property disposal or full loan repayment.
To illustrate the impact, suppose you purchased a property 15 years ago and used a total of S$200,000 in CPF OA savings over that period for the downpayment and monthly repayments. The accrued interest on that S$200,000, compounded monthly at 2.5% per annum, amounts to approximately S$91,000 depending on the timing of your withdrawals. This means you would need to refund approximately S$291,000 to your CPF OA upon selling the property.
If your sale proceeds are insufficient to cover the full refund of CPF principal plus accrued interest, you only need to refund up to the net sale proceeds after settling the outstanding mortgage and necessary expenses - provided the property is sold at or above market value. You are not required to top up the shortfall from other funds.
The accrued interest mechanism exists to protect your retirement savings. By requiring a refund with interest, the government ensures that using CPF for property does not significantly diminish your retirement nest egg.
Understanding accrued interest is particularly important when deciding between using CPF or cash for your mortgage payments. Paying more in cash and preserving your CPF savings means less accrued interest accumulates, potentially leaving you with more cash when you sell. Conversely, maximising CPF usage frees up cash flow now but increases your refund obligation later.
This is an area where strategic planning can make a meaningful difference to your long-term financial outcome, and Cashew's advisors can model different scenarios to help you find the right balance.