always check with HDB if the policies on their website is not clear :)

Yes, I agree with Hya. Always check with HDB prior to making any decision. :)

9 Dec 2008

1. Get the low-down on home loan top-ups – BT (8 Dec 2008), p1
2. Home-loan top-ups not needed – My Paper, pA8

Banks told BT that as long as borrowers are current in their monthly loan instalments, they will not ask for fresh valuations, which could then lead to a top-up in home loans, despite the current slide in property prices. A DBS Bank spokeswoman said that a key consideration when granting loans is the repayment ability of the customer, and even those on deferred payment scheme (DPS) need not worry about the fall in value of their homes, as their repayment ability would have already been taken into consideration upon the approval of their loan applications. Meanwhile, Monetary Authority of Singapore said that non-performing housing loans are currently low and they do not expect the increase to be significant.

Those who have not obtained a loan for their DPS property in late 2007 will have some impact.

what kind of impact? do elaborate?

if the bank value their properties below their purchase price, these buyers may not get as much loan as they thought they could. those that can afford to top up the difference need to pay more in cash, those that cannot afford have no choice but to quickly sell their property.

we shall look forward to more fire sales next year then?

so does hdb offer the lowest home loan rate in sg?

i would think so babypig. the interest is pegged to cpf interest rate.

Thanks to ribena for the clarification. That's why there are more loans being applied at this time in view of falling property valuation even though their TOP could be 1 or 2 years later.

Hi fuzzy, where do you stay, the value of your house double in 4yrs. thats a lot.

why are hdb dwellers usually adverse to taking bank loans? do banks offer different rates for hdb and private property?

Some banks do offer better rates than HDB for the 1st 3 years but the subsequent years may be higher depending on the SIBOR.

News @ AsiaOne

Lower Sibor attracts more home buyers

0.9% rate sees more interest but analysts warn of risks. -ST

Sat, Dec 13, 2008
The Straits Times

By Gabriel Chen

INSTALMENTS for many home loan borrowers are set to fall after the all-important interest rate at which banks lend funds to one another nosedived to about 0.9 per cent this month.

Many home loan packages are pegged to this rate - known as the three-month Singapore Interbank Offered Rate (Sibor) - so when it goes down, so do Sibor- linked home loan instalments.

According to economists, the three-month Sibor should remain at these depressed levels into the new year.

Why Sibor is down

There is widespread market expectation that the US Federal Reserve will cut its Fed funds target rate to 0.25 per cent from 1 per cent at its meeting next Tuesday. Sibor closely tracks this rate.

Continued measures by the Singapore authorities to pump liquidity into the system.

I read about it too. The article quoted SCB's 2year lock-in SIBOR rates... I wonder if they have read it off somewhere? Like here online ;)

ehh... unless u can repay really fast, else the bank loan rate will be really high. must check for fine prints on whether u can finish repaying in first x years when the interest rate is low. the last time i checked on a reno loan, there was a hefty penalty if i repay within x years when the interest rate is like very low. not worth it.

just to share some experience on private property home loan, since i have been through the ordeal recently.

most bank are offering either SOR or SIBOR rate + spread. pls refer to the first page of for definition/discussion.

the rates i got below might change, pls refer to the bank as i am no broker or banker.

UOB/OCBC - both offers SOR +1.25% only, for BUC project no lockin
DBS - SIBOR + 1.25% for BUC project no lockin

I prefer HSBC cause they have the most competitive rate in the market now
BUC project - SIBOR + 0.9%

Completed project or (upon TOP can convert) - SIBOR + 0.9% year 1, SIBOR +0.8% year 2, SIBOR + 0.7% year 3 onwards.
this is their loyoalty scheme, to keep customer.

additional, 5 years fire insurance free, legal fee subsidy up to 2.5k or 5% of loan
cant remember what else i can get.

will be signing with them this evening, as loan approved

i took the hsbc loyalty scheme too. my spreads are lower, but mine was taken a few months back & for completed project. only 1 year free fire insurance though. just had an interest rate reset, saved $100+ from monthly installment with falling Sibor. quite happy with that.

After refinancing with HSBC, I manage to save $2k per mth. :)

HSBC should reward us for promoting their home loans.