(Last Updated: 1 Nov, 2024)

8 Benefits Of DBS Home Loan

DBS boasts of holding the titles of “World’s Best Bank” (and equivalent) concurrently by Euromoney, The Banker and Global Finance.  More importantly, it has also won multiple accolades of “World’s Best Digital Bank” and being recognized widely for its push into digital solutions and frontiers in recent years.  This bodes well as the bank is strongly positioned to take on challenges and disruptions brought about by fintechs and global tech giants muscling into the realms of financial services.

Besides being present in 18 markets globally including six priority markets in Asia – Singapore, Hong Kong, Indonesia, Taiwan, China and India, DBS also boasts of the largest network of branches in Singapore and the biggest pool of Sing dollar funds.  This is apparent with the acquisition of the POSB franchise in 1998 for S$1.6b then. POSB (Post Office Savings Bank) was a household brand beloved by many generations of older Singaporeans as the first bank they opened their savings account with as a kid.

The fact that many Singaporeans credit their salary to a DBS/POSB bank account gives DBS a strategic edge in the marketing of its suite of retail products and services – which it does to great success especially for Singapore mortgages!  The DBS Multiplier Account (made famous now by the “rabbit” advertisements) is marketed strongly as a unique feature of DBS home loans.  See details below. 

And salary crediting allows DBS to access perhaps one of the biggest pool of some S$160b Sing dollar deposits. That gives it an unrivalled position amongst the three local banks to offer competitive longer term 3-year fixed rate home loans, if it so wishes.  DBS also champions many product innovations – it pioneered the use of fixed deposit rates (called FHR) to price its mortgages, probably the first-of-its-kind in the world.  And DBS promises FHR to be a more stable and reliable mortgage loan peg, less susceptible to extreme swings in interest rate cycles – as fixed deposit rates are known to stay low for long periods in Singapore.

Apart from Singapore residential properties financing, we also broker DBS’s property financing packages for:

• Commercial property loan under personal name
• Commercial property loan under company name

Before we go on, you may check all the latest rates from the market here:

DBS Home Loan Packages

(For Completed Residential Property)

DBS Home Loans Packages
(Rates may change from time to time, check best DBS home loan rates)

	FLOATING HOME LOAN RATE	FIXED HOME LOAN RATE
Mortgage Loan Peg	3M SORA (Compounded)	3M SORA (Compounded)
Year 1	3M SORA + 0.60	2.60 (Fixed)
Year 2	3M SORA + 0.60	2.60 (Fixed)
Year 3	3M SORA + 0.65	3M SORA +1.00
Year 4	3M SORA + 1.00	3M SORA +1.00
Year 5	3M SORA + 1.00	3M SORA +1.00
Year 6 (thereafter)	3M SORA + 1.00	3M SORA +1.00
Lock-in	2 years	2 years
Minimum Loan	$500,000	$500,000
Remarks	Free conversion end lock	100% penalty waiver on sale Free conversion end lock
Cash Rebate (refinancing only)	$2,000 for >$500k $2,500 for >$1m $2,800 for >$1.5m	$2,000 for >$500k $2,500 for >$1m $2,800 for >$1.5m

NOTE: There are “deviated rates” for DBS home loan rates lower than what you see here but which we are unable to publish. Contact us for details or apply here.

Which local bank’s home loans is the best right now?

There is probably a case to be made for one to stay open to any bank’s offer, let alone local banks that most are familiar and comfortable with.  That’s how one can benefit from the dynamics of a free market.  Think airfares before budget airlines took off, or more recently, taxi fares before disruption by Uber/Grab.

In fact, looking beyond rates per se, staying open to all options becomes even more meaningful now.  This is because mortgage loan features have become more and more differentiated from one bank to another.  Some of these could be more beneficial than that few basis points difference in rates offered by different banks.

We like to present here the lesser known benefits of why one should consider applying for DBS home loans.

Why DBS Home Loans? 8 Benefits..

Fast approval	DBS, being one of the most digitalized banks in Singapore, will not be second to others in terms of approval turnaround time.  As long as all documents are complete. Approvals can be just as fast and instant.
Highest cash rebate	Similar to OCBC, DBS offers cash rebate and not legal subsidy for refinancing cases. This is important as one could effectively put “extra cash” in his pocket after refinancing is completed.  This happens as one could opt to pay the legal fee of $1,800 net (special rate from our partner law firms) for refinancing of private properties from their CPF!  Hence, keeping the entire cash rebate of $2,000 (or more) which will be credited into his DBS account later.  In the case of legal subsidy, the law firm bills the bank and this option of paying via CPF will not be available. What’s more, DBS is one of the most generous when it comes to cash rebate for private properties refinancing – loans above $1m gets $2,500 in total instead of the usual $2,000 from most other banks. This effectively covers the valuation fees as well and make DBS home loans a “zero-cost” option for those looking to refinance over $1m.
Multiplier Account	DBS is one of few banks that bundles home loans as one of the categories under its Multiplier Account mechanics where one needs to transact simply more than a total combined value of $5,000 in 3 categories (Salary/dividend crediting OR enrol SGFinDex + home loan instalment + monthly credit card spend) to earn high deposit interest rate (revised from time to time) on the first $50,000 in the account. Do check the bank’s website. This is much higher than sourcing for the highest fixed deposit rate in town, which requires one to commit the funds for a period of time like 12-month. In fact, it is possible to earn higher interest on the next $50,000 but it requires buying insurance products or doing investments with the bank, which is not a low-hanging fruit for most. So, we shall not discuss that here. As most Singaporeans already credit salary to a DBS account, taking a DBS home loan simply means one just need to shift spending from other banks to DBS credit cards to qualify for higher interest.  In fact, with typical home loan instalments in the range of $3,000-5,000, a DBS home loan makes it a possibility now to hit the next tier ($15,000 transaction value) of deposit interests. DBS Multiplier Account does not allow for joint account under husband and wife.  Please check the bank’s website for details.
FHR mortgage peg	In 2014, DBS pioneered pegging of home loan rates to fixed deposit rates that the bank publishes on its website daily.  This means that it is in the open and more transparent than traditional lending peg – internal BOARD rate for housing loans.  No one knows and no broker can really track the historical movements of BOARD rates over time.  The bank can choose to increase the BOARD rate for one segment of customers in its portfolio, but hold it for other segment. The other thing we like about FHR is how it is singular in nature.  The bank may have different tranches of FHR like the prevailing FHR6 (6-month fixed deposit tenure, and so on), FHR24, FHR8, etc. but there is only one such rate for each FHR tranche.  If DBS decides to hike FHR6 it will be applied across the board to both new and existing customers.  This makes it transparent and here at MortgageWise, we do track each and every FHR tranche closely since 2014. (Speak to our consultants). FHR as a mortgage peg is indeed more stable and lags behind any movements in SORA/SIBOR.  Due to this laggard effect and the generally smaller swings, we recommend it in periods when rates are going up. DBS one of few banks still offering a fixed deposit rate home loan peg at the moment.
Fixed rates	As we have explained earlier, DBS has a competitive advantage with its millions of DBS/POSB accounts when it comes to funding costs for Sing dollar lending. As such, the bank is able to consistently lead the market in offering the most competitive fixed rate home loans especially for 3-year or longer fixed term.  This becomes important when interest cycles are turning up as one would love the comfort of knowing – there will always be competitively-priced fixed rates for repricing later on when the lock-in ends.
Free conversion	Free conversion refers to repricing without being charged a conversion fee (typically $500 for local banks). Depending on the packages, DBS has been one of the more aggressive banks offering free conversions during lock-in periods, even for fixed rate home loans.  This is likely due to again its low-cost funding base compared to the other banks.  It markets the flexibility of such loans where homeowners can fix their monthly repayment yet retain the option to convert to any other prevailing DBS home loan package, usually after 12 months into a 2-year or 3-year lock-in period.
Waiver due to sale	DBS also offers a complete 100% waiver of the typical penalty of 1.50% (of the loan redeemed), if redemption is due to a sale of property during the lock-in period.   Again, this is a feature that is offered on selected packges and from time to time only.
DBS Treasures	From time to time, we noticed DBS does offer slightly differentiated pricing for its preferred banking or DBS Treasures customers. However, these tend to be on floating rate home loans rather than fixed, where typically the bank will shave off 3 basis points (0.03%) off the prevailing rate.
Online acceptance	Being the most digitalized bank, it comes as no surprise DBS is the first mortgage bank to do away with the need for physical signing of the Loan Offer (LO).   DBS bankers are able to send a link to applicants who can then login to scrutinize the loan offer terms from the comforts of their home, before putting their digital signatures on it for acceptance.  A copy of the digitally-signed LO will then be sent to the applicant a week later.

Like to compare home loan packages across all 12 major banks in Singapore?

Now, there’s one final benefit and perhaps the most pertinent reason for why you should take a DBS home loan through us at MortgageWise.sg – become completely Mortgage-Free In 6 Years!

Need more personalised advice?  Not only do we help clients navigate through the myriad of mortgage rates quick and fuss-free and get you the best home loan Singapore, we show you how to become Mortgage-Free in 6 Years! So, be it for residential or commercial property loan, work with us today and you’ll also be helping to support our social cause!

Stay tuned for rate alerts on our Telegram channel SG Mortgage Rates.

Disclaimer: MortgageWise Pte Ltd is not in the business of providing financial advice nor are we licensed or regulated by MAS under the Financial Advisory Act (FAA) in Singapore. All information presented are opinions and any representations given, whether by way of example, illustration or otherwise, are purely portfolio allocation advice and not recommendations or inducements to buy, sell or hold any particular investment product or class of investment product.  All opinions are generic in nature and are not tailored to the particular circumstances of any reader.  Seek advice from a qualified financial advisor before making any investment decision.

Though every effort has been made to ensure the accuracy of the information and figures presented, we make no representations or warranties with respect to the accuracy or completeness of the contents in this blog and specifically disclaim any implied warranties or fitness for a particular purpose.  We shall not be held responsible for any financial loss or any other damages suffered whatsoever, directly or indirectly, if you choose to follow any of the advice or recommendations given in this blog.