With more than 70% of Singaporeans being a homeowner, many of us have a home loan to service. It…
In a weird case of déjà vu, the world is now back to the new norm of low-interest-rate environment. The last time we experienced this low-interest-rate environment was back in 2008 when the Global Financial Crisis took place.
With low interest rate once again, home owners now have the opportunity to secure favourable interest rate for your home loan. If you have a home loan that you are looking to refinance, here are some tips that you will need to help you find the best deal.
Every home loan package comes with a lock-in period that you might not be aware of. A lock-in period refers to a time period where you have to stick with your existing home loan package until it expires. If you switch out of your existing home loan during this lock-in period, you will be penalized and suffer a penalty by the bank. In some cases, the penalty might even be more than the savings you get from refinancing to a cheaper home loan deal. That’s why it is always prudent to check whether your lock-in period has expired before you start your search for a refinancing deal.
While you shouldn’t be rushing to refinance just because you can, you shouldn’t drag it for too long either. That’s because the earlier you refinance to a new home loan package, the earlier you cut your monthly mortgage repayment. This can translate to a few hundred dollars of savings every month for you which you can channel into your savings or even your retirement plan.
Thinking of where to channel your extra savings to? Why not consider an endowment plan to help you save for your next big ticket item?
If you have an existing home loan, make sure to check with your bank to see if you can do a repricing.
Sometimes, banks will be willing to offer a repricing when you are very near to hitting the 1-year/2-year lock-in mark to keep you as a customer with the bank. This will help you avoid the trouble of refinancing with a new bank and doing the paperwork for refinancing. At the same time, you will still get to enjoy the lower interest rate that comes together with refinancing.
Plus, some cheaper home loan packages come with 1-2 free repricing option that you can utilize to reduce your monthly mortgage repayment by repricing to a lower interest rate package.
Although interest rate information is pretty much openly available on all bank websites, it still requires some time and effort to browse through every single one for you to find the best home loan deal in the market. What if there’s an easier way for you to accomplish this step of finding the cheapest home loan?
Instead of comparing home loan packages yourself, why not let Moneyline.SG do the hard work for you? As a web comparison tool, Moneyline.SG sweeps through the banks’ website to find the most suitable home loan & refinance interest rate base on your needs. Not just that, Moneyline also helps you speed up your home loan application with the bank.
Should you be refinancing your HDB loan to a bank loan in this low-interest-rate environment? Here’s what we think.
Now that you have all the tips you need to help you find a cheaper home loan to refinance, it’s now time for you to take action. Reach out to us at Moneyline if you want to partner a mortgage broker to help you breeze through the home loan refinance application.
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