Housing Loan Singapore

www.Housingloansingapore.com

Providing online home loan services since 2009

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.

Definition

Prepayment

A mortgage prepayment basically refers to a payment made by a borrower to reduce the principle balance on the home loan, thereby reducing interest costs.

A partial prepayment is any lump sum payment towards the outstanding balance to reduce it. While a full prepayment is a payment that completely pays off the entire balance of the loan.

They can also be called partial redemption and full redemption.

Home loans in Singapore can either be structured with prepayment penalty charges, without them, or have a combination of both.

For most housing loans, prepayment penalties would be definitely incurred during the early years of a loan due to an active lock-in period. After which there would be no penalties for partial redemption, but a borrower would be penalized for full redemption.

The penalty fees would be charged on a percentage of the amount being prepaid.

For example, 1% on the prepayment amount.

This means that if a loan for example has $100,000 outstanding, a 1% full redemption penalty would mean that the borrower would have to pay $101,000 to redeem the loan… plus any administrative charges.

In some loan contracts, a borrower would have redemption penalties waived should the property be sold within a number of years from loan commencement.

This is to target flippers and speculators who are looking for sub-sales profits.

In competitive lending environments, lenders can insert harsh prepayment clauses into loan agreements to deter borrowers from refinancing with other banks.

Oddly enough, for under construction properties, home loans often don’t come with lock-in period.

It’s as if lenders find them risky and encourage borrowers to switch to another bank.

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What We Do For You

We Gather And Provide You Information On The Best Housing Loans In Singapore So That You Can Make A Better Decision Based On What Is Available In The Market

Which bank do you recommend for home loans in Singapore?

We don't recommend banks. We recommend you the best home loan that suits your profile and financial position.

How Does SOR Rates Hit Negative Value?

SOR rates are calculated with a complex financial formula, solved with simple algebra. The results of solving the equation therefore depends on the inputs used. Varying inputs that result from economic impacts and indicators can lead to negative value when the formula is solved. Key input indicators include USD/SGD spot rates and USD/SGD forward rates.

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.

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.
Want to see housing loan interest rate trends for the last 36 months?

Enter your email below so we can send it to you.

It makes absolutely no sense to pay more
than you have to on a home loan.

Find the best mortgage rates here
SEE RATES
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It makes absolutely no sense to pay more than you have to on a home loan.

Find the best mortgage rates here
VIEW TODAY'S RATES
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