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Experience The Difference With Delux Mortgage
Gain access to the lowest housing loan interest rates in Singapore for your new purchase or home loan refinancing. We are your Mortgage Broker from the start till the end of the entire housing loan application timeline, from bank application to conveyancing law firms. Just think of a personal secretary for your home loan.
1. Informed, Transparent, Clear
As your mortgage broker, it is our responsibility to get you the lowest home loan package in the market. However this shouldn’t be the only factor to consider when applying for a mortgage. There are many blindspots that one could only hope that they knew them in the first place. Global interest rate environment and the breakdown of cost are just a few examples. We break them down into simple terms and we equip you with current market knowledge so that the choice becomes clear.
2. Compare & Get The Best Home Loan Deal
Calling bank to bank, travelling from branch to branch to seek the lowest home loan interest rate package is a thing of the past. At Delux, you have all banks housing loan interest rates at your fingertips, even unpublished ones. Once you have decided on the package to go for, the bank of your choice will be in touch with you. No more frustrating customer service hotline or long waits.
3. Our Service is 100% Free
We believe in a Win-Win situation with customers in mind. At Delux Mortgage, expect service that you can trust at absolutely no cost. We partner with all banks in Singapore and all of them pay us a standard fee when we refer home loan customers. Expect unbiased and professional advice from us.
Home Loan First, Property Second
While it’s easy for one to get overly excited about owning that dream home and dive straight into placing a deposit, wouldn’t it make sense to make sure that you are eligible to get a mortgage first? After all we are talking about your biggest commitment here in Singapore. Regardless if it’s a HDB or a private property, it’s important to follow these simple steps below to secure the best home loan package for your purchase.
Process Of Getting A Home Loan In Singapore
In order for you to determine what you can buy, first you have to know what you can afford. It is important to consider how much you are able to borrow, together with the cash and CPF you have on hand, before you can decide on which property to go for. Your loan amount is determined by the banks way of calculation using the Total Debt Servicing Ratio (TDSR) and Mortgage Servicing Ratio (MSR) for Private properties and HDB/EC respectively. We are here to help you with that, giving you an instant quotation so that you can work out your finances.
After working out your budget and scouring through property listing portals to identify several potential units to go for, get your Approval In Principle (AIP) before arranging for viewings. An Approval In Principle (AIP), also known as In Principal Approval (IPA) guarantees that you are able to get mortgage financing from the bank so that you can have a peace of mind when you place your deposit to get the Option To Purchase. At Delux, we have streamlined the process to make it simpler and faster for you to get one.
Once you are at this step, it means that you are almost ready to own your dream home! You have successfully come to an agreement with the seller on the price and have received the Option To Purchase. Currently you have two or three weeks to exercise your option depending on whether it's a private or HDB. Before doing so, you will need to apply and secure a home loan from a bank of your choice. Our Mortgage Specialists are here to provide you with unbiased and professional advice.
Here Are The Important Things You Need To Consider When Choosing Your Home Loan
01
Market Conditions
It is important to know where the SIBOR market is headed in the next couple of years. Market forces are in play here and it will determine whether if you should be going for a fixed rate home loan packages to hedge against increasing cost of borrowing or floating rate home loan packages to enjoy maximum savings
Need some help deciding?
Let our experienced mortgage specialists narrow down your options.
Home Loan For Private Property In Singapore
As an owner of private property in Singapore, you are eligible to take up a home loan with either the banks or financial institutions. Resale EC owners together with Condos and landed properties will have to make a decision of either going for the most competitive floating rate packages in the market or take up a fixed rate home loan package to pay a fixed monthly instalment on their home loans. For Buildings Under Construction (BUC), owners can only choose from floating rate packages. These BUC packages do not have a lock in period and borrowers are free to repay the principal loan amount. Note that HDB loan is not applicable for private properties.
Key highlights on the best housing loan package that each bank is offering for private property in Singapore. Banks offer different home packages for different loan amounts. Use our wizard to find out the most competitive packages in the market for your loan size tailored according to your preference.
| Property Status | Bank | Package | Year 1 Interest Rate | Key Highlights |
|---|---|---|---|---|
| Resale | DBS | 5 Years Fixed Rate | 1.50% | Interest rate stability for 5 years |
| Resale | UOB | 2 Years Fixed Rate | 1.40% | Allow you to sell your house during lock in period |
| Resale & Uncompleted | OCBC | 3 Months SORA | 1.29% | Only bank offering SORA Pegged interest package |
| Resale | Maybank | 3 Months SIBOR | 1.25% | SIBOR package with a 1 year lock in period |
| Resale | SCB | 3 Months SIBOR | 1.05% | Attractive rate for Priority Banking customers |
| Resale & Uncompleted | HSBC | 1 Month SIBOR | 1.25% | Offering 1 Month SIBOR package |
| Resale | Citibank | 1 Month SIBOR | 1.10% | Attractive rate for Citigold & CPC |
| Resale | CIMB | 2 Years Fixed Rate | 1.30% | CIMB Priority Banking |
Home Loan For HDB In Singapore
We all know that HDB concessionary loan comes at 2.60% per annum but many HDB owners still choose it over a bank loan. You have the option of applying for an HDB housing loan as long as you fulfill certain conditions, such as maximum household income eligibility and private property ownership. One can also only take it up for a maximum of 2 times. Depending on how urgently you need a roof over your head, you can go for a Build To Order (BTO) flat, sale of balance flat or resale HDB flat and it will affect the housing loan package that you are able to take. In general, bank loan interest rates for HDB flats are cheaper as compared to HDB concessionary loans but there are reasons why one chooses the latter instead. Reasons such as Loan to value (LTV) and cash down payment requirements.
Key summary on the best housing loan package that each bank is offering for HDB flats in Singapore. Again, banks offer different interest rates for different loan amounts. Use our wizard to find out the most competitive packages in the market for your loan size tailored according to your needs.
| Property Status | Bank | Best Package | Lock In | Year 1 Rate |
|---|---|---|---|---|
| Resale | DBS | 5 Years Super Cash Promo | 2.60% | Up to $10,000 cash rebate for HDB refinancing only |
| Resale | UOB | 2 Years Fixed Rate | 1.40% | Allow you to sell your house during lock in period |
| Resale & Uncompleted | OCBC | 3 Months SORA | 1.29% | Only bank offering SORA Pegged interest package |
| Resale | Maybank | 3 Months SIBOR | 1.25% | SIBOR package with a 1 year lock in period |
| Resale | SCB | 3 Months SIBOR | 1.25% | Attractive rate for Priority Banking customers |
| Resale & Uncompleted | HSBC | 1 Month SIBOR | 1.30% | Offering 1 Month SIBOR package |
| Resale | Hong Leong | Board Rate | 1.40% | No valuation fee required for refinancing |
HDB Concessionary Loan VS Bank Loan
Probably the most frequently asked question between the two. Singaporeans are usually in a dilemma between taking up a housing loan directly from HDB or taking it up with a bank. While both have their advantages and disadvantages, it is important to note that HDB loans have certain restrictions as well and not everyone is eligible. Restrictions such as having at least one Singaporean HDB owner and not exceeding the maximum household income.
Traditionally most risk averse HDB owners will turn to HDB loan because they are perceived as being more lenient on repayments. Typically bank’s housing loan interest rates are usually lower than HDB’s 2.60%, but some still turn to HDB because of the lower down payment requirements.
Regardless, even if you have taken a HDB loan at the time of purchase, you can always refinance to a bank loan to save on monthly repayments.
| Features | HDB Concessionary Loan | Bank Loan |
|---|---|---|
| Interest Rates | 2.60% | 1.30% - 1.50% |
| Down payment requirement | At least 10% of purchase price using CPF | At least 25% of purchase price, with minimum 5% being cash |
| Loan Tenure | Up to 25 years | Up to 30 years |
| Monthly repayments | CPF or Cash | CPF or Cash |
| Lock In Period | No Lock in | 0 - 3 years |
What You Need To Know About Bank’s Fixed And Floating Rate Packages
It is important to get a competitive home loan package. However that doesn’t necessarily mean that the lowest is the best. You have to understand that each and every individual borrower's situation is different and unique. Fixed rate is better suited for homeowners who prefer a stable monthly cash flow while floating rates can be good for owners who wish to do partial repayment from time to time.
Fixed Rate Home Loan Packages
Banks do not offer a perpetual fixed rate package unlike overseas. It is typically fixed for 2 to 5 years depending on the package that you go for. A 2 years fixed rate package should be lower than a 3 years fixed rate package. The monthly instalments will be the same throughout the lock in period, giving you stable cash flow projections over the next couple of years. After the lock in period is over, you will revert back to a floating rate. Fixed rate packages are usually less flexible as compared to their floating rate counterpart. If you choose to refinance or sell your house within the lock-in period, you will be charged with a repayment penalty of 1.50% from most banks.
This is an example of how a 2 years fixed rate package looks like:
| Year | Interest Rate |
|---|---|
| Year 1 | 1.50% Fixed |
| Year 2 | 1.50% Fixed |
| Year 3 | Floating + 1.10% (higher than Year 1 & 2) |
| Year 4 & thereafter | Floating + 1.40% (higher than Year 3) |
Floating Rate Home Loan Packages
With different options available for floating rate packages, it can be quite a handful to decide on which one to go for. The most commonly heard is SIBOR, Singapore Interbank Offering Rate. The rest are Fixed Deposit Linked, bank internal Board Rates. There is a latest addition to the floating rate family, known as SORA in short. Floating rates packages are able to fluctuate as the name suggests, with some being more transparent than others. Volatility also depends on which benchmark you are being pegged to. For example, SIBOR is the most transparent since it’s dependent on the market and not determined by any one bank. With this being said, it also means that SIBOR is volatile because it reacts with market forces. There are 1 month SIBOR (1M SIBOR) and 3 months SIBOR (3M SIBOR) offered by different banks for home loans.
Quick Glance At Floating Rate Home Loans
| SIBOR | Fixed Deposit Linked | Board Rate | SORA | |
|---|---|---|---|---|
| Summary | Fluctuates depending on the average interbank lending rates | Interest rates adjust based on bank’s Fixed deposit interest rate | Interest rate changes depending on bank’s internal decisions | Fluctuates depending on the average rate of all SGD overnight interbank transactions |
| Transparency | Highly transparent | Transparent | Non transparent | Highly transparent |
| Volatility | High | Low-Mid | Mid-High | High |
SIBOR VS Board Rates
Sibor also known as Singapore Interbank Offered Rate is an average interest in which banks lend money to one another at. It is published daily on the Association Of Banks Singapore website and monitored closely. Mortgage Board rates are home loan interest rates that the bank determines internally. Mortgage board rate is actually the first type of housing loan package introduced in Singapore, even before SIBOR. SIBOR packages are definitely the most transparent with Board rates being the least. In terms of volatility, SIBOR is higher since it’s pegged to global interest rate environment.
1M and 3M SIBOR For The Year 2020
| Month | 1M SIBOR | 3M SIBOR | 1st Business Day Of |
|---|---|---|---|
| January 2020 | 1.75% | 1.774% | 2 Jan 2020 |
| February 2020 | 1.69% | 1.71% | 3 Feb 2020 |
| March 2020 | 1.58% | 1.63% | 2 Mar 2020 |
| April 2020 | 0.99% | 1.00% | 1 Apr 2020 |
| May 2020 | 0.57% | 0.83% | 4 May 2020 |
| June 2020 | 0.25% | 0.56% | 1 Jun 2020 |
| July 2020 | 0.25% | 0.55% | 1 Jul 2020 |
| August 2020 | 0.25% | 0.44% | 3 Aug 2020 |
| September 2020 | 0.25% | 0.40% | 1 Sept 2020 |
Historic Board rate trends are not displayed since different banks have different benchmarks and definitely not published.
SIBOR VS SORA
SORA is the weighted average of all SGD overnight transactions in Singapore, also known as Singapore Overnight Rate Average. It is equally transparent as SIBOR since both are closely monitored and published daily. While SIBOR is forward looking since it’s reacting to global interest rate events and anticipations, SORA is backward looking because it accounts for actual transactions.SORA will be the replacement for SOR and probably even for SIBOR in the future to become the key benchmark SGD interest rates.
SORA For The Year 2020
| Month | SORA | 1st Business Day Of the Month |
|---|---|---|
| January 2020 | 1.68% | 2 Jan 2020 |
| February 2020 | 1.47% | 3 Feb 2020 |
| March 2020 | 0.85% | 2 Mar 2020 |
| April 2020 | 0.25% | 1 Apr 2020 |
| May 2020 | 0.08% | 4 May 2020 |
| June 2020 | 0.05% | 1 Jun 2020 |
| July 2020 | 0.10% | 1 Jul 2020 |
| August 2020 | 0.08% | 3 Aug 2020 |
| September 2020 | 0.09% | 1 Sept 2020 |
Frequently Asked Questions
An In Principle Approval (IPA) or Approval In Principle (AIP) is a pre home loan application check. The bank determines your maximum loan eligibility depending on the property type you are buying, Regardless of how confident you are in your income level to secure a home loan, it’s still advisable to do an IPA before placing the deposit for your option to purchase. This helps to cover all blindspots such as Total Debt Servicing Ratio (TDSR) or Mortgage Servicing Ratio (MSR) and to facilitate a smooth transition. The last thing you need is a hiccup before you secure the house and affect your judgement.
Banks home loan packages are changing so frequently and each has their own competitive period and edge. Today it can be DBS Bank, but tomorrow it can be UOB or OCBC. Certain foreign banks like Maybank and SCB home loans are aggressive in recent years That is why a Mortgage Broker like Delux is here to provide transparency to this problem. We update the latest home loan packages in almost real time and our Mortgage Specialists will follow up with a call to provide clarity on which is the best based on your needs and preferences.
Let a Mortgage Broker like Delux show you the lowest home loan interest rate package in the market. Compare the lowest home loan interest rates easily with our website and even gain access to unpublished rates. Our years of experience and connections in the mortgage industry means that you will only get the best.
Whether to go for a fixed or floating home loan interest rate package is subjective. It also depends on the current interest rate environment globally. During a rising interest rate environment, you would naturally want to go for a Fixed rate to fix your monthly repayments. It also depends on individual risk appetite. If your cash flow or CPF OA balance is healthy, you might want to take a little more risk and go for the floating rate home loans to enjoy maximum savings during a dropping interest rate environment.
Unless you are taking a fixed interest rate package, your interest rate is not fixed during the bank’s lock in period. Lock in period exists even for floating rate packages but it just means that you cannot refinance to another bank without incurring any early repayment penalties.
Yes foreigners are able to apply for a home loan in Singapore. However do note that different banks have different internal guideline policies for non citizens/PR borrowers. Loan To Value will also be affected for foreigners. Foreigners cannot apply for a HDB loan.
SIBOR is short for Singapore Interbank Offered Rate. It is the average interest rate at which banks in Singapore lend money to one another. It is also public knowledge, since it is published daily. There are 1M SIBOR or 3M SIBOR that borrowers can choose from.
