Why you should consider refinancing your Singapore Mortgage

Why you should consider refinancing your Singapore Mortgage – Covid 19 has casued havoc on the economy that was humming along quite well. Though disturbed by the trade war, things are still growing fine albeit slower than it could have been.

Interest rates were at a very high rate for an extended period and it did not make much sense to go ahead with refinancing your Singapore Mortgage during that period of time.

Fast forward to June 2020, the virus has been travelling around the world and causing havoc everywhere and killing many people in the course of its spread.

Globally to keep economies running, central banks have cut interest rates to support businesses and also to spur spending through the borrowed money.

This also allows for other forms of interest to fall.

Mortgage Loan Rates in Singapore and around the world have seen one of the lowest rates in a decade due to the extremely bad performing economy.

With current SIBOR rates at 0.2X%, we are expecting things to stay this low for an extended period of time.

Lets explore, “Why you should consider refinancing your Singapore Mortgage”.


  • Rates will start to climb when the economy starts to recover

The Central bank of Singapore, the Monetary Authority of Singapore, dropped rates to boost the economy through lending.

This is true for most economic theories that uses low interest rates to spur spending.

Rates will eventually have to rise again and when this happens, so will your mortgage rates if it is not fixed or if you decided to postpone the decision to refinance.


  • Rates are unlikely to get this low for a long time

With the MAS committing to a close to 0% interest rate to fight the Covid-19 economic slowdown, the rates are expected to be this low for quite awhile. But as all economic theories goes, it is unlikely to stay low forever.

As the economy starts to recover, SIBOR will climb and as it climbs, it is likely to cause Singapore Mortgage Interest rates to climb again.

If you missed the boat on doing your Singapore Mortgage Refinancing, you might not be able to enjoy the lowest of the lowest rates anymore.


  • You save a big chunk of cash, that can be used elsewhere

For a Mortgage Rate that is 2.6% for HDB loans for example, at the current refinancing rates of 1.5%, for a loan quantum of $500,000. You can save up to $500 a month.

That is $500 of monthly investments that can help you generate more wealth or $500 more you can spend on food for your family members.

This is a way to increase your wealth by merely reducing your output of cash.


  • Rules are more relaxed than before due to crisis rules

For a period of time, cooling measures such as the TDSR (Total Debt Servicing Ratio) are extremely strict but with the new rules now, to help families tide through this difficult times and reduce financial outlays. The banks are slightly more open to a slight ratio that is above limit and you may qualify now with the same financial status as compared to before.


Avant Mortgage is a Singapore based Mortgage Loan Broker, that can assist you in your Mortgage Loan applications and refinancing.

Speak to us to learn more about your case and get to work on your case in a more advisory role.

We will love to work with you to acquire the best rates for your income and needs situations.

Avant Mortgage, Your Trust Loan Advisors.

Why you should consider refinancing your Singapore Mortgage