BEST MORTGAGE HOME LOAN RATES (UPDATED JANUARY 2024)

What should you consider while choosing a property loan

Before selecting a home loan package, it’s important to understand the various jargons associated with mortgage loans. As you explore different banks’ offerings, you’ll come across terms like SORA, SIBOR, LTV, lock-in period, floating and fixed interest rates.

Here are some factors you need to consider before locking the right loan:

  • Property type
  • Fixed vs floating interest rate
  • Bank vs HDB loan
  • Lock-in period of the loan package
  • Total debt servicing ratio

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What should you consider while choosing a property loan

Before selecting a home loan package, it’s important to understand the various jargons associated with mortgage loans. As you explore different banks’ offerings, you’ll come across terms like SORA, SIBOR, LTV, lock-in period, floating and fixed interest rates.Here are some factors you need to consider before locking the right loan:

  • Property type
  • Fixed vs floating interest rate
  • Bank vs HDB loan
  • Lock in period
  • Total debt servicing ratio

Compare home loan rates across 10 banks

GET RATES

 

How do I apply for a home bank loan?

Step 1 – Compare the best home loans
First, you’ll need to compare the latest home loan interest rates and packages available on the market. Let us do the heavy lifting for you. Simply fill up a simple form and our mortgage specialists will compare and prepare a list of the best home loans for you. We will help you with your applications, answer your questions, and give you unbiased advice.

Step 2 – Get Your In-Principle Approval (IPA)
The next step is identifying how much you can borrow. Factors such as Total Debt Servicing Ratio (TDSR) and valuation of the property plays the largest roles. Getting your In-Principle Approval in advance will ensure you get the right property without delay.

Step 3 – Apply for your home loan
Once you have your IPA, your home loan application process can be completed within two to seven working days.

What are the differences between bank and hdb loans?

HDB loans are available only to HDB property purchases, while bank loans can be taken up for any property type. Eligibility of the buyer plays a part too (to be addressed later).

Property typeHDB loanBank Loan
HDB
Executive or private condominiums
Landed
Commercial

An overview of the differences between bank and HDB loan:

Property type: HDB

FeatureHDB loanBank Loan
Interest rate2.60%3.6% – 5.5%
Loan-to-value (LTV) Ratio80%75%
Minimum downpayment20% in cash and/or CPF5% cash + 20% in Cash and/or CPF
Mortgage Servicing Ratio (30%)30%30%

The values are based on a 25 year loan tenure and is for illustration purposes only

Property type: Condominium or landed

FeatureBank loan
Interest rate3.5% – 5.5%
Loan-to-value (LTV) Ratio75%
Minimum downpayment5% cash + 20% in Cash and/or CPF
Maximum Total debt servicing ratio (TDSR) allowed55%

The values are based on a 30 loan tenure and is for illustration purposes only

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What is the difference between floating and fixed rate?

Fixed rates

A fixed interest rate ensures that your home loan’s interest rate remains constant for a specific duration, typically 2 to 5 years depending on your lock-in period. This means that your monthly installments will remain unchanged during this period.

Opting for a fixed interest rate offers the advantage of predictable cash flow management since your payments are consistent. However, it’s important to note that once the lock-in period expires, your home loan’s interest rate is likely to increase or switch to a floating rate.

It is recommended to get in touch with your bank to explore the possibility of repricing or refinancing your loan in order to obtain a desirable lower interest rate once the lock in period is over.

Floating rates

A floating interest rate, also known as a variable interest rate, is subject to change and can fluctuate based on market conditions.

In Singapore, there are four main types of floating interest rates: Board rates, SORA floating rates, SIBOR floating rates (which will be fully phased out by 2024), and fixed deposit rates. The movement of these rates is influenced by factors such as market conditions. Here is a summary of how these rates may vary.

Factors determining floating rates

 Board rateSORASibor*Fixed Deposit rate
Dependent onBank’s full discretionSingapore Overnight Rate Average (SORA) is the volume-weighted average rate of borrowing transactions in the unsecured overnight interbank SGD cash market in Singapore between 8am and 6.15pm.Based on Singapore Interbank Offered Rate (SIBOR) which is the interest rate banks pay when they borrow money from other banksBank’s fixed deposit rates
Transparency on how rates are derivedNot transparent because board interest rates are set internally within each bank.Highly transparent as rates are public information and monitored by the Monetary Authority of Singapore (MAS)Highly transparent as rates are public informationTransparent as rates are published on banks’ websites

*Not applicable for new loans

How much can you borrow? Also known as TDSR

Having a clear understanding of your borrowing capacity, both as an individual and with your co-buyer, is crucial in evaluating your property choices.

 The implementation of the Total Debt Servicing Ratio (TDSR) in 2013 aimed to promote responsible borrowing by setting a limit on the amount you can borrow. Currently, the TDSR restricts borrowing to a maximum of 55% of your gross monthly income (before CPF deduction). It’s worth noting that the limit was initially set at 60% but was revised to 55% on December 16, 2021.

Use this calculator here to simulate your repayments depending on the different loan factors.

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Determining your eligibility for a home loan

Eligibility criteria differ for HDB loans and bank loans. Here are the requirements for each:

 

HDB loans eligibility

  1. Citizenship: You must be a Singapore citizen.
  2. Previous housing loan: You should have taken only one housing loan from HDB in the past.
  3. Gross monthly household income: For families, it must not exceed S$12,000; for extended families, it must not exceed S$18,000; for singles, it must not exceed S$6,000.
  4. Previous property: Your last property should not have been a private residential property.
  5. Current property ownership: You must not currently own a private residential property.
  6. Property sale: You should not have sold a private residential property in the last 30 months.
  7. Additional property ownership: You must not own more than one market/hawker stall or commercial/industrial property. The one other property must be a business operated by you.
  8. Income sources: If you own a commercial/industrial property, you must not have any other source of income.

 

Bank loans eligibility

  1. Citizenship: Does not matter
  2. Age requirement: You must be at least 21 years old.
  3. Minimum income: You must have a minimum annual income of S$24,000.

Why get your home loan through us?

Effortless, Quick, Convenient
Relieve yourself of the burden of researching home loans, as we will simplify the process for you. Our Mortgage Specialist will personally reach out to you,saving you valuable time for other priorities in life.

We compare and get you better deals.
We compare across all major banks in Singapore to ensure that you get the best deals. Plus additional discounts kept only for our customers.

No additional cost to you
Our services are provided to you at no cost. We receive a standard referral fee from banks for the services we provide and the excellent work we do. Rest assured that we maintain impartiality and offer unbiased advice without taking any sides.

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What documents do you need to apply for a bank mortgage loan?

You will need the following documents:

  1. Copy of NRIC
  2. IRAS property summary
  3. IRAS account summary
  4. Last 15 months CPF contribution history
  5. Last two years of Notice of Assessment (NOA)
  6. Last three months’ payslips
  7. HDB “Financial Information” Details
  8. Option-to-purchase (OTP)
  9. Valuation Report (For HDB properties only)
  10. Latest credit facilities statements (including existing credit cards, car and personal loans)
  11. Credit report from the Credit Bureau that will be obtained by the banks
    Latest outstanding Home Loan Statement from current Financier / HDB
  12. CPF Property Withdrawal Statement
  13. Bank loan application form

Mortgage providers we work source from

  • CIMB
  • Citibank
  • DBS bank
  • Hong Leong Finance
  • HSBC
  • Maybank
  • OCBC
  • RHB
  • Standard Chartered
  • UOB

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