Answer
Option to Purchase (OTP) Exercise Fee
The OTP is a legally binding agreement that gives you the right — but not the obligation — to buy a property. The exercise fee is what you pay to commit.
Answer: 1% option fee + 4% exercise fee for new launch (5% total). For resale: OTP fee typically 1%, exercise adds another 4% = 5% total. HDB resale OTP fee is just $1–$1,000.
OTP Fees by Property Type
| Property Type | Option Fee | Exercise Fee | Total Deposit | Exercise Deadline |
|---|---|---|---|---|
| New Launch Condo | $5K–$10K (~1%) | 4% of price | 5% | 3 weeks (21 days) |
| Private Resale | 1% of price | 4% of price | 5% | 14 days (negotiable) |
| HDB Resale | $1–$1,000 | Balance of deposit | ~5% at completion | 21 calendar days |
New Launch Condo — How It Works
Booking fee (option fee) — typically $5,000–$10,000, paid at the showflat when you book a unit. This is roughly 1% of the purchase price.
Exercise fee (4%) — paid within 3 weeks of receiving the S&P agreement. Combined with the booking fee, this brings your total deposit to 5%.
Stamp duty — BSD (and ABSD if applicable) payable within 14 days of exercising. This is separate from the deposit.
Remaining 15% — payable in cash + CPF within 8 weeks of exercise, bringing total to 20% downpayment (for 75% LTV loan).
What If You Don't Exercise?
Buyer walks away — you lose the option fee. For a $1.5M condo, that's $15,000 (1%) gone. The OTP expires and the seller is free to sell to someone else.
Seller backs out — if the seller reneges after granting OTP, they must return 2x the option fee to the buyer. On a $1.5M property with 1% option fee, that's $30,000 the seller pays.
OTP expires — no penalty beyond the lost option fee. You're not obligated to exercise.
Example: $1.5M New Launch Condo
| Stage | Amount | Cumulative |
|---|---|---|
| Option fee (booking) | $7,500 (0.5%) | $7,500 |
| Exercise fee (within 3 weeks) | $67,500 (4.5%) | $75,000 |
| BSD (within 14 days of exercise) | $44,600 | $119,600 |
| Remaining downpayment (8 weeks) | $225,000 (15%) | $344,600 |
| Total before loan | 20% + BSD | $344,600 |
Planning to buy?
Run your full numbers — downpayment, stamp duty, monthly payments, and what you can afford.
FAQ
What is the OTP exercise fee?
The exercise fee is the additional payment you make when you formally commit to buying a property after receiving the Option to Purchase. Combined with the initial option fee, it forms your total deposit before completion.
What happens if I don't exercise the OTP?
You lose the option fee you paid upfront. For new launches this is typically $5,000–$10,000. For private resale it's usually 1% of the purchase price. For HDB resale it's the negotiated amount ($1–$1,000). The OTP simply expires and the seller can sell to someone else.
What happens if the seller backs out after granting OTP?
For private property, if the seller backs out after granting the OTP, they must return 2x the option fee to the buyer. This penalty is built into the OTP contract to protect buyers.
How long do I have to exercise the OTP?
For new launch condos: typically 3 weeks (21 days). For HDB resale: 21 calendar days. For private resale: 14 days is standard, but negotiable up to 21 days.
Can I negotiate the OTP option fee?
For HDB resale, yes — the option fee is negotiable between $1 and $1,000. For private resale, it's typically 1% but can be negotiated. For new launches, the developer sets the amount (usually $5,000–$10,000).
Related
- What Is an Option to Purchase (OTP)? — 14–21 days to decide
- Down Payment for First Condo — 25% (5% cash + 20% CPF)
- Progressive Payment Scheme — pay in stages as condo is built
- Minimum Cash Down Payment for Condo — 5% of purchase price
Last updated Feb 2026. OTP terms may vary by developer and transaction type. This is informational, not financial advice.