(F) commercial property loan singapore

Best Interest Rate For Commercial Property Loan

[Time-sensitive article, correct as of 26-Mar-2021] 

It’s not always that we talk about commercial property financing (including industrial properties) in this blog.  However, we just got to shout about this excellent commercial property financing package that’s almost on par with that of residential home loan rates!

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Best 3Y-Fixed Rate 1.45% For Commercial Property Loan!

SPECIAL COMMERCIAL PROPERTY LOAN PACKAGE
Year 1
1.45% (Fixed)
Year 2
1.45% (Fixed)
Year 31.45% (Fixed)
Year 4 onwardsBOARD + 1.50 (2.07)
Lock-in
3 years
Processing Fee
$1,000
Legal Subsidy
0.40% capped $1,800
Valuation Subsidy
$500
Min Loan
$300,000
Available For
Refinancing & purchase
Commercial & industrial properties

With yields rising in the US and expectation of rising inflation, it may be good time to lock down fixed rate for commercial property loans. This is one of the lowest 3-year fixed rate in the market right now, subject to availability (banks typically stop the promotion when fixed tranche for the promotion is used up)

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What we like about this package is not just the headline-grabbing fixed rates.  The thereafter spread when the fixed term ends is hovering in the 2.00-3.00% range which is acceptable for commercial loans!  The problem with most commercial property loans is that the spreads after the lock-in period ends can shoot up to obscene level like 6.50% when pegged to commercial BOARD lending rates.  This often pose a headache for most companies or business owners who are often then at mercy of banks when it comes to repricing offers, or be forced to pay back the legal fee subsidy (clawback).

If they continue to jump from one lock-in period to another, it becomes very hard to sell off the commercial property at a good price, without incurring a hefty redemption penalty of 1.5% (of the outstanding loan) due to sale within the lock-in period.

With a more reasonable thereafter rate even after the lock-in period of two years, this package is good for commercial property owners who are looking to sell their asset at the right price in the short to medium term.  Even if they do not sell off the office, retail, industrial or shophouse unit, they could rest easy knowing they are paying what is just slightly above residential home loan rates and not get ripped off big time with thereafter interest rate at 6.5%!

Speak to us now if you have a commercial property loan with interest rates expiring in the next 6 months.

Since 2014, MortgageWise.sg has provided thought leadership in the mortgage planning space in Singapore, seeking to build trust with clients over the longer term rather than product-peddling for quick one-time deals.  So, be it to refinance home loan, or to buy your next Singapore condo, speak to our dedicated team of mortgage consultants here for the best Singapore home loan rates.

Compare All Latest Rates 2021