Tips to Getting the Best Housing Loan Interest Rate

Posted by finance guy on Friday, February 3rd 2012

3
Feb

Compare and get the best housing mortgage rate in Singapore

It is undeniable that the housing loan interest rate applied on your loan greatly affects the total amount that you would be paying for your newly-acquired home. For this reason, it is important that you are able to take advantage of the best mortgage loan interest rate so that you wouldn’t go beyond your budget. The first thing that you need to do is find out which banks give the lowest rates as well as the ones that are most likely able to give you the package that you need. You would also need to familiarize yourself regarding the different interest rate structures that would best fit your needs.

When applying for a loan, you will notice that most borrowers prefer to have SIBOR as their housing loan interest rate structure over the Swap Offer Rate or SOR. This is because SIBOR is considered to be generally more stable than SOR which is dependent on foreign currencies and is more volatile. If you have a fixed income that would only allow you to set aside a certain amount each month, a fixed interest rate is what you should consider. Lock-in periods for fixed interest rates may vary from bank to bank, with some offering no lock-in period for the loan you choose. Varied interest rates on the other hand are determined by banks and other financial institutions, meaning that you have no control when the rates will increase or decrease. As such, it is important that you take the time to review each type of interest rate structure before you decide which type of loan to go for.

Another thing that you would need to consider in order for you to get the best housing loan interest rate is thoroughly calculating the number of years that you would be paying off your loan. Remember to factor in your children’s income if you plan to pass on the house to them in the future. This would increase your chances of getting a low interest rate and a higher cash out which you can use to make your down payment. Also, if your monthly, bi – annual or annual payments are high, this would decrease the number of years that you would be fulfilling your loan balance thus greatly decrease the housing loan interest rate that you would be paying.

However, there are simply too much to learn, so it may make sense to simply rely on a singapore mortgage consultant to help you.

As with all decisions you make, it is very important that you be able to weigh your options and compare between several loan offers before choosing which to go for. There are certain factors out of your control, but the specifics mentioned above can be improved on to your advantage. By gathering as much information as you can you will be able to obtain a housing loan that will allow you to make payments on time as well as provide you with the opportunity to have your own home without suffering from a high housing loan interest rate that can leave you in dire straits.