SIBOR or SOR?

SIBOR is generally more stable while SWAP tend to fluctuate more. However 3-month SWAP has recently stayed consistently lower than 3-month SIBOR for an extended period of time. SOR is also very reactive to currency exchange rates.

Which bank offers the best home loan deals?

Interest rates and spreads are not all that matter. Don't ignore the closing costs involved. Different banks can have different customized home loans for you. Don't be surprised if you will save more on a home loan that charges more interest because of the lesser closing costs involved. This is especially so if you know that you will refinance your home loan as soon as the lock in period has expired.

HDB loan or bank housing loan?

Our opinion is to always take a HDB concessionary loan if you are eligible for one. One of HDB's objectives is to to provide affordable housing for the people. While a bank is profit driven.

Gift Of Equity

When the transaction price of a property is considerably less than it’s market value, the difference is considered a gift by the seller.

These types of transactions are common in ownership transfers between family members.

In terms of housing loans, lenders sometimes allow the gift to be classified as a down payment.

This can have a major impact on loan to value and total amount of financing involved.

For example, if an apartment is worth $800,000 and the transaction price is $500,000, the difference of $300,000 converts to a down payment.

For a loan of $500,000, it is effectively a 62.5% LTV.

If the borrower’s personal or household income is able to support a $500,000 loan, the borrower can in theory obtain 100% financing consisting of a gift and mortgage.

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