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DBS Refinancing Loans

DBS Refinancing Loans
(Product Review)

Updated November 18, 2022

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Product Review

DBS is a renowned loan bank in Singapore and also in Southeast Asia. It has estate holdings of $646 billion in total assets and over 10.7 million consumer banking customers. DBS is one of the most reliable banks with decades of business expertise as an active lender. In addition to this, it is known for giving benefits such as the DBS Home Payment Care scheme that provides coverage for instances like loss of income, regular interest on your savings, and more.

Its carefully constructed portfolio as a renowned bank, granting affordable mortgage loans in Singapore has helped DBS achieve the “AA-” and “Aa1 ” credit ratings, which are among the highest in the world. DBS also won the “Safest Bank in Asia” award by Global Finance for 12 consecutive years.

This renowned Singaporean bank likely offers some of the most accessible and friendly mortgage rates. Mortgagers are recommended to study DBS’s housing loans and choose the one that suits their needs. Due to its unique style and strategy, the bank offers all mortgagers a chance to revise their loan arrangements, it gives S$2,000- S$3000 in subsidies for the legal fees of loans over S$500,000.

DBS is the best option for prospective homeowners because its interest rates are reasonable. This loan bank is one of the most low-priced mortgagees in Singapore. Interest rates tend to change frequently, so compare rates with other banks.

For instance, DBS grants low-priced HDB and private home loans for completed buildings or ongoing building projects ( like BTO, DBSS and EC flats) with fixed or bargainable rates that can be in lock-in periods. Since competition is high in the banking business, few financial institutions offer less expensive introductory costs. However, the total cost of home loans in DBS is reasonable when compared to the charges of other banks. This has been maintained because these ‘cheap’ finance establishments tend to tremendously Increase their rates in subsequent years.

In addition to its budget-friendly rates, DBS demands service fees for mortgages, partial repayment fees, full redemption penalties and cancellation fees.

Service Fees

As earlier stated, DBS charges standard fees for various loan services. These fees will be outlined in the table below for home loans and refinancing home loans.

Loan Type Partial Repayment fee Full Redemption Pinalty Cancellation Fee
HDB Tracker N/A N/A 1.5%
Private Tracker 1.5% 1.5% 1.5%
Board Rate (Lock-in) 1.5% 1.5% 1.5%
Board Rate (No lock-in) N/A N/A 1.5%
Fixed Rate 1.5% 1.5% 1.5%
BUC N/A N/A 0.75%

DBS Refinance Packages

Per Monetary Authority of Singapore (MAS) regulations, the benchmark for Singapore’s interest rates was recently changed, this made DBS switch from Swap Offer Rate (SOR) and Singapore Interbank Offered Rate ( SIBOR) to Singapore Overnight Rate Average (SORA).

DBS provides refinance packages which are based on the 3-month Compounded SORA rate, DBS Board (FHR6) rate and fixed rate.

Bank 1st Year Interest Lock-in Period
DBS SORA Check Live Rates 2 Years
DBS SORA Check Live Rates 2 Years
DBS Board Check Live Rates 3 Years
DBS Board Check Live Rates 2 Years
DBS Fixed Check Live Rates 5 Years

When considering refinance options regarding fixed or floating rates, it is essential to thoroughly analyse and determine the direction of the market in 2-4 years (Lock-in periods), and its impact on your total mortgage. DBS recommends that you consider a longer time frame because of the refinance options available after locked periods.

When To Apply Floating Rates

The best opportunities for floating rates come when market interest rates are relatively stable or declining.

Floating rates are mostly lower than fixed rates because financial institutions willingly offer a lower rate in short term to build trust and loyalty among customers. This gives them the privilege to demand higher rates when interest rates increase in the market. Fixed rates are slightly higher than floating rates because of the premium demanded by banks.

When To Use Fixed Rates

After the rates have declined and there is gradual progress in the market, refinance with a fixed rate to avoid extra costs. Although fixed rates are slightly higher than floating rates, they protect mortgagers from significant market rises. Choosing to refinance at a fixed rate of 1.5% for three years, will make your interest rate stable at 1.5% at the end of that period, while a floating rate beginning at 1% will likely be 2-3% at the end of three years.

These rates could give a whopping S$5,000 difference in annual interest.

Lenders often inquire about your current loan’s interest rate (when refinancing) and offer a lower one to secure your patronage. This is favorable for homeowners who can refinance their current home loans, and reduce monthly installments and total mortgage costs. Note that most banks require a loan balance of at least S$100,000 and 5 years. These rules are open to revisions, so contact the mortgage broker before making any decision.

Lower interest rates guarantee lower monthly payments. However, if you decide to not refinance your current mortgage, your interest rate will likely Increase leading to higher costs.

With lower interest rates, you will enjoy lower monthly payments. If you choose to forego refinancing your existing mortgage loan, your interest rate will almost always increase leading to higher monthly installments and total interest costs.

PROMOTIONS

APPLICATION PROCESS

  • Launch Application via the ROSHI Marketplace Lock-in periods of up to 5 years

    Once your application is live you will be able to review suitable loan options on your dashboard. One of our mortgage brokers will follow up with you to discuss the best available options and next steps.

  • Choose Suitable Mortgage Option

    After you’ve decided on a preferred mortgage option one of our mortgage brokers will help process your application.

  • Settle Fees & Charges

    Settle all fees (option fee, option exercise fee to the seller as well as the relevant buyer’s stamp duty fee in case you are purchasing a private property)

  • Appointment Date & Signing

    Attent your property purchase appointment date and sign all legal documents for the transfer of the property, paying all legal and valuation fees.

PRODUCT HIGHLIGHTS

  • Affordable Rates

    Affordable and budget-friendly home loan interest rates

  • Refinance loans

    Provision for Mortgagers to refinance home loans of more than S$500,000

  • Interest

    Individuals hoping to earn interest as they pay off their loan

  • Limited Refinance Amount

    Borrowers seeking to refinance a home loan of less than S$500,000

ALL DETAILS

Loan Features

  • Offers cheap and reasonable fixed and floating home loan rates
  • Lock-in periods available
  • Lock-in periods of up to 5 years

Frequently Asked Questions

Does DBS offer refinancing solutions?

Yes, DBS offers some of the most competitive refinancing solutions in the market. Depending on your existing loan and lender you may want to consider refinancing via DBS.

What's the difference between repricing and refinancing?

When you refinance you are moving your existing loan to another bank while when you reprice you are switching to a different package with the same lender.

Should I consider refinancing my existing loan with DBS?

This depends on various factors such as your existing interest rate, available interest rates in the market as well as loan terms & conditions.

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