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.

Subordination

Subordination occurs when a lien holder agrees to a lower priority claim against the asset (property) which allows another creditor to take it’s place.

When default and foreclosure happens, creditors will be in a queue that determines who gets repaid first with the proceeds of the sale.

The party with the first lien will have the debt cleared first, followed by the second if there’s any balance remaining and so on.

In regards to home loans, even though the practice of subordination is common in western markets, it is not common in Singapore simply because it will be tough to find a bank here that will agree to have it’s lien subordinated.

Do consult the advice of the lawyer when in doubt.

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