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.

Qualification

Mortgage qualification is the process a loan officer takes to determine whether a borrower will be able to obtain a requested loan quantum based on information provided by borrower during discussion.

Do not make the grave mistake of assuming a loan qualification is the same as a loan approval or approval in principle.

There are various reasons why housing loans can be qualified but not approved later:

  • Home buyer or co-borrower has bad credit
  • Buyer unable to provide proper documentation to verify income claims
  • Borrower carrying more debt than declared
  • Employment status has changed between the date of qualification to the date of application
  • etc

This is why a borrower should be as frank and candid as possible should they choose to seek qualification rather than approval before buying a house.

Sometimes, information that are critical to lenders might not be deemed as important to borrowers.

They then leave out or misrepresent material information during qualification.

When the application is submitted and a credit analyst finds that information don’t match up from due diligence checks, the loan can be declined.

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