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War On Fixed Rates

At MortgageWise we welcome the latest 3-year fixed rate package from HSBC as it rejoins the lucrative home loans business in recent months after a hiatus of last few years.  Indeed, if you look at the average industry delinquency rate from MAS statistics, there can be no other more profitable business than mortgage lending with a NPL ratio as low as 0.5% versus that across all loan segments of 1.30-1.50% (based on the 3 local banks’ latest financial results).  The last thing that homeowners will want to default on is home loans especially for the roof over one’s head.

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For homeowners, with more lenders joining the fray to offer competitive rates be it for fixed rates or FDR home loans, it keeps the incumbents in check which leads to more choices and lower interest for every one.  This can only be a good thing.  Just like how with entrants of home loan comparison sites like us, it levels the playing field for big and small lenders in the market with a more efficient distribution network regardless of one’s branch network, size of the sales force, or the level of digitalisation.  In fact, it can lead to higher margins for smaller players with lower overheads.

Which is likely the reason why we have seen more aggressive pricing from foreign banks of late especially for fixed rates.  Take a look at how they all stack up below as we present the most saleable fixed rate package from each bank:

fixed rate home loans singapore Aug 2017

Not all banks offer 3-year fixed rates which is at a slightly higher premium than the lower 2-year fixed rates in the market.  Is this premium worth paying for?  That depends on one’s view on the pace of interest hikes over the next few years.  The US Labour department has just released rather dismal figures of 156,000 jobs created in August, and revised downwards the figures for June and July earlier.  What does this all mean?  Speak to our consultants to find out more on our view as we continue to track the financial markets closely.

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Besides the headline rates, there are also other interesting loan features and incentives to look out for when choosing between the various fixed rate home loan packages, from the reduction of 1.50% penalty due to sale of property within the lock-in period, one-time free conversion, to even $600 dining vouchers as sign-up gifts.  Call us today to find out more as we dissect these for you and help you find the most suitable option based on your needs.

Besides HSBC introducing a new 3-year fixed package, UOB has also recently brought back their 3-year fixed rate and lowered their 2-year fixed to 1.48% down from the earlier 2-year at 1.58%.  Generally fixed rate is the way forward, until this latest fixed rate war ends by September which is when we expect US Fed to announce in its FOMC meeting this month to start trimming down its massive US$4.5t bonds.  We think that is when the market will start to see some real impact on the dollar and 10-year yields, and hence interest rate movements within three to six months of such bond sale actions.  Besides, with floating rate now at 1.28% and some banks moving up their floating rate packages of late, it becomes a no-brainer to go fixed when the gap between fixed and floating is less than 20 basis points (0.20%)!

And if you are looking to buy a Singapore condo be it for own-use or investment, there is no better time to do it now with property market at a turning point, ultra-low fixed rates at historical low levels (but not for very much longer we think), and the latest MortgageWise’s Legal Fee Privilege of $1,800 nett for all completed residential property purchases up to $3m (terms apply) which saves you at least $700 in transaction costs for private property purchases!

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We heard some rumours in the market that our latest legal fee privilege is nothing more than just gimmicks.  I will take this chance to clarify here that the benefit is real and substantial – if you just bought a private property and choose to take a home loan through us of not less than $500,000, we will save you a cool $700 in legal fees.  Period.  This is not one of those “up to $500” gimmicks for vouchers or incentives on a graduated basis where you also get the $500 only if your loan is more than $2m!  This is absolute savings of $700for every single one of our client, as long as the loan is above $500,000.  Market legal fee for private property purchase is $2,500 or higher, but you would be enjoying the exclusive rate of $1,800 nett, including mortgage stamp duty and GST, when you choose to take your loan through us.  The usual terms will apply as would any privilege programmes, but absolutely no gimmicks.  And yes, it is definitely valid for private property purchases be it completed or buc (building-under-construction), as much as it is for HDB (completed resale only).

You see at MortgageWise, we are never into gimmicks.  We take our job very seriously and we perform it with pride – to give the best impartial advice to our clients who entrusted us with their mortgage decisions.  We promise to give you that “whole of market” perspective on all mortgage options out there which no other brokers would tell you.  We want to be sure we are giving the correct advice each time we do a mortgage review, helping you to save on interests and whatever costs involved.  Which is why we go to great lengths to put together a set of rewards and privileges for all MortgageWise clients.  As long as you choose to work with us be it for new purchase or refinancing of your existing loan, you will access a lifetime of benefits being a MortgageWise client.  We will reward you and all your friends too.

For the best home loan rates, speak to our consultants today and start a professional working relationship with us as so many of our clients have come to experience.  See their testimonials.

At, we seek to provide thought leadership in the area of mortgage planning in Singapore, taking deep dive into developments and news on mortgages & helping clients track interest rate movements.  We do not just go for one-time business with clients but rather choose to build long trusting relationships by giving truly independent advice to the extent of losing the deal.  We strive to become the first-choice mortgage partner for homeowners and the creditable distributor of mortgage products for banks and financial institutions in Singapore.

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