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Thread: DBS launches new home loan products

  1. #1
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    Default DBS launches new home loan products

    http://www.businesstimes.com.sg/sub/...79940,00.html?

    Published September 3, 2011

    DBS launches new home loan products

    Among them are packages pegged to Sibor plus a spread

    By EMILYN YAP


    DBS Group has launched three new home loan packages to attract home buyers looking to benefit from current low interest rates.

    One of these products is pegged to the three-month Singapore Interbank Offered Rate (Sibor) plus a spread. The home loan rate will be capped at 1.49 per cent for the first three years to provide borrowers with some degree of stability and protection against future Sibor increases.

    The second package is pegged to the one-month Sibor plus a spread, and the benchmark rate will be refreshed every three months. DBS says it is the first bank in Singapore to come up with such an arrangement, and it hopes home buyers can benefit from a lower Sibor rate at less volatility.

    Yesterday, the three-month Sibor was 0.34917 per cent while the one-month Sibor was 0.21806 per cent.

    Home buyers who take up a mortgage insurance called My Protector Mortgage get to enjoy lower spreads on the floating-rate home loans.

    For instance, for the three-month Sibor package, the spread is 0.85 per cent for someone who signed up for the mortgage insurance, versus one per cent for someone who did not. Nevertheless, both will be covered by the three-year 1.49 per cent interest rate cap.

    The mortgage insurance is underwritten by Aviva and will pay for the outstanding mortgage commitment in the event of death or terminal illness of the insured borrower.

    DBS is also offering a three-year fixed rate home loan. Home buyers who take up the mortgage insurance on top of this will pay a rate of 1.38 per cent, which the bank says is the lowest in the market. The fixed rate is 1.48 per cent without the mortgage insurance.

    After the first three years, the rate for this product is pegged to the three-month Sibor plus 1.25 per cent.

    Home loan rates have come under scrutiny recently as interest rates in Singapore fall. Sibors have been low, largely a result of loose monetary policy in the US. The three-month Sibor, for instance, has dipped considerably from 0.43751 per cent at the start of the year.

    Swap Offer Rates (SORs) have even turned negative, prompting some banks to stop offering home loans pegged to them. The three-month SOR was -0.05104 per cent yesterday.

    Falling interest rates have triggered concerns about banks' net interest margins, although analysts are keeping a closer eye on how a potential slowdown in the economy could impact banks' businesses.

    On the stock market yesterday, DBS lost five cents to close at $13.10.

  2. #2
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    perhaps 1.48/1.49% cap for 3 years is enough to entice buyers in and hence explain the new sales boom in aug and sep despite the gloomier global outlook?

  3. #3
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    now the lowest to get is SOR+0.65 thru'out with 2 year log-in with min SOR of 0.2 or

    SOR + 0.75 with no log-in with min SOR at 0.1.


    Dont think 1.49% is a good rate in comparison

  4. #4
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    Quote Originally Posted by rattydrama
    now the lowest to get is SOR+0.65 thru'out with 2 year log-in with min SOR of 0.2 or

    SOR + 0.75 with no log-in with min SOR at 0.1.


    Dont think 1.49% is a good rate in comparison
    Its a cap.....those u mention got cap anot?

  5. #5
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    Is this from a foreign bank?
    Quote Originally Posted by rattydrama
    now the lowest to get is SOR+0.65 thru'out with 2 year log-in with min SOR of 0.2 or

    SOR + 0.75 with no log-in with min SOR at 0.1.


    Dont think 1.49% is a good rate in comparison

  6. #6
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    Hi guys,

    Anyone of you opted to pay your loan instalments by cash instead of CPF? Is it wise to do so since interest is 2.5% if you keep your $$$ in CPF?

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    If your cash can work harder for you like more 2.5%. Why use Cash.
    Quote Originally Posted by Montaigne
    Hi guys,

    Anyone of you opted to pay your loan instalments by cash instead of CPF? Is it wise to do so since interest is 2.5% if you keep your $$$ in CPF?

  8. #8
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    hmmmm, got a point.. but m not good in other investments. money stuck in bank. Thinking of investing in property only, so since can use cpf for another property in future so maybe use cash to pay for current property lor...

  9. #9
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    Quote Originally Posted by Montaigne
    hmmmm, got a point.. but m not good in other investments. money stuck in bank. Thinking of investing in property only, so since can use cpf for another property in future so maybe use cash to pay for current property lor...
    I did this for 6mths, but reverted back to use CPF to service the loans, bec I feel safer to have more cash

  10. #10
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    Stand chart for BUC projects:
    0.55%, 0.55%, 0.65%.
    Choice of either 1 or 3 months sibor
    no lock in.
    1% early redemption
    4 hrs fire insurance

    Is this good? If this isn't good, can someone pls give recommendations.

  11. #11
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    Quote Originally Posted by mygeemeel
    Stand chart for BUC projects:
    0.55%, 0.55%, 0.65%.
    Choice of either 1 or 3 months sibor
    no lock in.
    1% early redemption
    4 hrs fire insurance

    Is this good? If this isn't good, can someone pls give recommendations.
    4hrs fire insurance??? what tat har?

    Also your legal fees absorbed?

  12. #12
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    Quote Originally Posted by Geylang OKT
    4hrs fire insurance??? what tat har?

    Also your legal fees absorbed?
    Alamak. 4hrs fire insurance isn't a good deal. They giving me 4 years now.

  13. #13
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    Quote Originally Posted by mygeemeel
    Stand chart for BUC projects:
    0.55%, 0.55%, 0.65%.
    Choice of either 1 or 3 months sibor
    no lock in.
    1% early redemption
    4 hrs fire insurance

    Is this good? If this isn't good, can someone pls give recommendations.
    Which specific proj? I got 5yr fire ins for my clients and full legal sub for certain proj.

  14. #14
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    Fire insurance is quite cheap even for 5 years.
    Quote Originally Posted by newbie11
    Which specific proj? I got 5yr fire ins for my clients and full legal sub for certain proj.

  15. #15
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    Quote Originally Posted by mygeemeel
    Stand chart for BUC projects:
    0.55%, 0.55%, 0.65%.
    Choice of either 1 or 3 months sibor
    no lock in.
    1% early redemption
    4 hrs fire insurance

    Is this good? If this isn't good, can someone pls give recommendations.
    For Euhabitat, they offer .5%

  16. #16
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    Top Seller status for Aug with 439 confirmed sold units.

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