SOR-based loans

**auroraborealis** · 14-09-12, 09:16

Currently, I have an SOR loan at 4th year with higher loan spread then the past years. If I choose to refinance, I can get lower all-in interest rate but no more SOR-based. This bank has only floating rate packages based on board rate (no SOR no SIBOR).

Assuming changing bank is not an option here, would you refinance to non-SOR or just bear with the higher loan spread?

**silver023** · 14-09-12, 09:52

Originally Posted by auroraborealis

Currently, I have an SOR loan at 4th year with higher loan spread then the past years. If I choose to refinance, I can get lower all-in interest rate but no more SOR-based. This bank has only floating rate packages based on board rate (no SOR no SIBOR).

Assuming changing bank is not an option here, would you refinance to non-SOR or just bear with the higher loan spread?

Board rate = little transparency. But I would presume your current spread is already 1%? If so, I would go for the lower spread after I have checked with the banker on histirical board rate. Also would not commit to a lock-in of more than 2 years

**Laguna** · 14-09-12, 11:40

go for SIBOR....
SOR is too risky without transparecny and fluatate widely

**carbuncle** · 14-09-12, 11:43

what crap bank is this only got board rate

**Rosy** · 14-09-12, 11:46

Originally Posted by auroraborealis

Currently, I have an SOR loan at 4th year with higher loan spread then the past years. If I choose to refinance, I can get lower all-in interest rate but no more SOR-based. This bank has only floating rate packages based on board rate (no SOR no SIBOR).

Assuming changing bank is not an option here, would you refinance to non-SOR or just bear with the higher loan spread?

If your clawback is already over, please refinance with other banks asap.

**newbie11** · 14-09-12, 15:44

Originally Posted by auroraborealis

Currently, I have an SOR loan at 4th year with higher loan spread then the past years. If I choose to refinance, I can get lower all-in interest rate but no more SOR-based. This bank has only floating rate packages based on board rate (no SOR no SIBOR).

Assuming changing bank is not an option here, would you refinance to non-SOR or just bear with the higher loan spread?

interesting scenario.. why is changing bank not an option? ask for history of board rates. some banks have not change it for years..

**hopeful** · 14-09-12, 16:09

Originally Posted by newbie11

interesting scenario.. why is changing bank not an option? ask for history of board rates. some banks have not change it for years..

maybe person has no income, cpf statement etc. if change bank, need to show the statements. if dont change bank, just change package then no need the statements.

**auroraborealis** · 14-09-12, 18:33

got another tranche still under lock-in...

Originally Posted by newbie11

interesting scenario.. why is changing bank not an option? ask for history of board rates. some banks have not change it for years..

**auroraborealis** · 14-09-12, 18:36

actually prefer SOR over SIBOR for now... SOR is market-determined, so long SGD appreciating, SOR remains low. SIBOR is under review by MAS & ABS now due to LIBOR problems... Don't know what the overhaul will be yet

Originally Posted by Laguna

go for SIBOR....
SOR is too risky without transparecny and fluatate widely

**amk** · 14-09-12, 20:05

Originally Posted by auroraborealis

got another tranche still under lock-in...

Like that only you yourself can compute the payoff since only you will know the size and additional lockin period and spread. Assuming your 4th yr onwards spread is 125bps, the current best spread is about 80. For 45bps running until ur other tranche is over, I would say just stick with it and dun do anything. U reprice with anything will get u another lockin , not to mention u lose the SOR reference.

**DC33_2008** · 14-09-12, 20:57

SOR went below Sibor today. Will it go lower?

**amk** · 14-09-12, 23:15

Originally Posted by DC33_2008

SOR went below Sibor today. Will it go lower?

Yes. My view. Until next MAS speech to reset the tone.

...btw Sor1m has been lower than SIBOR 1m for quite some time already...

**phantom_opera** · 14-09-12, 23:28

Originally Posted by amk

Yes. My view. Until next MAS speech to reset the tone.

...btw Sor1m has been lower than SIBOR 1m for quite some time already...

amk, what do u think of the following, this Bill Gross really really smart, dumped 30b already in August ... the volatility is simply stomach crunching

USGG10YR:IND 1.86160 0.12900 +7.49%
USGG30YR:IND 3.07750 0.13970 +4.77%

**auroraborealis** · 14-09-12, 23:29

Agree... From a boarder perspective, is it worth saving say 30-50bp but give up SOR base rate forever. Seems like more banks withdrawing SOR packages? If no more banks offer SOR loans 2 yrs down, I'll be faced with same question again

Originally Posted by amk

Yes. My view. Until next MAS speech to reset the tone.

...btw Sor1m has been lower than SIBOR 1m for quite some time already...

**amk** · 16-09-12, 10:50

Originally Posted by phantom_opera

amk, what do u think of the following, this Bill Gross really really smart, dumped 30b already in August ... the volatility is simply stomach crunching

USGG10YR:IND 1.86160 0.12900 +7.49%
USGG30YR:IND 3.07750 0.13970 +4.77%

Very honestly I think these people are daring speculators. Every one talks "QE is imminent", yet very few really reposition hugely prior to last week.

I do not have enough expertise on bond markets. My personal view is current bond prices are as high as any other assets. I will either take profit, or stay put, but not enter.

**Ringo33** · 16-09-12, 13:07

Originally Posted by amk

Very honestly I think these people are daring speculators. Every one talks "QE is imminent", yet very few really reposition hugely prior to last week.

I do not have enough expertise on bond markets. My personal view is current bond prices are as high as any other assets. I will either take profit, or stay put, but not enter.

Think soro did took a huge positionon gold recently

**auroraborealis** · 25-09-12, 15:24

thank u all for replies

done the deed for now... repriced @ 3M sibor+ no lock, hopefully BOC will still be there next yr with the SOR package

**auroraborealis** · 25-09-12, 15:27

a side note; mortgage bankers these days not very honest
took some probing to get sibor package... they started by giving you the lowest "all-in rate packages" that are all based board rate... after checking back 2-3 times, then they come back with 1 or 3 mth sibor packages

**titanic266** · 25-09-12, 15:42

So what are the latest SIBOR or SOR mortgage package (after QE3)? I am looking at repricing my existing mortgage

Anyone have any information? Thanks in advance!

**auroraborealis** · 25-09-12, 16:57

got mine @ + 100bp but becos cannot change bank for now

think can get + 75 to 95 bps if flexible with bank & willing to be lock-in

just that very few banks offer SOR+ packages; BOC & ANZ as far as I know... ANZ has very very strict property control list (i.e. they choose which project they are willing to fund) & very very very strict credit underwriting standards.

absence of SOR... 1M SIBOR+ packages are next best
as i have soft spot for the shortest available base rate tenor available... thus will end up with either 1M sibor or 3M sor for now

Originally Posted by titanic266

So what are the latest SIBOR or SOR mortgage package (after QE3)? I am looking at repricing my existing mortgage

Anyone have any information? Thanks in advance!

**cnud** · 26-09-12, 00:31

Took a new loan with 1m SIBOR + 0.75% for 1st 3 years. No lock in.

Good deal?

**newbie11** · 26-09-12, 01:01

Originally Posted by auroraborealis

a side note; mortgage bankers these days not very honest
took some probing to get sibor package... they started by giving you the lowest "all-in rate packages" that are all based board rate... after checking back 2-3 times, then they come back with 1 or 3 mth sibor packages

Very certain u didn't use my site

**titanic266** · 04-10-12, 10:05

Thanks Auroraborealis!

In the end, I have repriced my mortgage with DBS at 3mth SIBOR +75bps (Yr 1 to 3) and 3mth SIBOR +100bsp thereafter... 2 years lock-in.

Guess its is easier and "cheaper" to reprice these days since there are no more legal subsidies (and other goodies) from banks.

Cheers!

Originally Posted by auroraborealis

got mine @ + 100bp but becos cannot change bank for now

think can get + 75 to 95 bps if flexible with bank & willing to be lock-in

just that very few banks offer SOR+ packages; BOC & ANZ as far as I know... ANZ has very very strict property control list (i.e. they choose which project they are willing to fund) & very very very strict credit underwriting standards.

absence of SOR... 1M SIBOR+ packages are next best
as i have soft spot for the shortest available base rate tenor available... thus will end up with either 1M sibor or 3M sor for now

**Riverund** · 06-10-12, 11:38

The new cooling measure encompasses refinancing as well. Once refinanced, you lose the ability to have >30yrs loan tenure or have lower LTV.

Looks like no difference in lock-in vs no-lock-in loans then as most incumbents will likely not refinance in the short-term. Unless spreads drop to 0% as someone mentioned.

**carbuncle** · 06-10-12, 11:52

unless one changes bank, can keep repricing until khaw kums homme.

if u are with Kuching Kurak bank, good luck. stuck for a very the long time.

**propertychap** · 06-10-12, 22:18

Can I check if we reprice with the same bank, the CM does not apply?
If i have a progressive loan for a property which is under construction, do I have to get a new loan when the property TOPs?

**DC33_2008** · 12-10-12, 16:24

3 mth SOR has dropped to 0.32 today.

**buttercarp** · 12-10-12, 21:14

Read this article about home loans.
I thought it is a good introduction for people with little or no idea about home loans.

http://www.moneysmart.sg/home-loans/...-in-singapore/

It said this..... Is it true?

"When SOR starts rising fast, the SIBOR rate restrains it, because you’re using the average of the two. On the other hand, if SOR rates plummet, it drags down the average of the two, causing you to pay less."

**auroraborealis** · 13-10-12, 00:59

I think he's talking about SOR+SIBOR combo packages...
I wld go for pure SOR or pure SIBOR... Not very interested in combos
Some bank also give 1-time option to convert from SOR to SIBOR during loan tenor

Originally Posted by buttercarp

Read this article about home loans.
I thought it is a good introduction for people with little or no idea about home loans.

http://www.moneysmart.sg/home-loans/...-in-singapore/

It said this..... Is it true?

"When SOR starts rising fast, the SIBOR rate restrains it, because you’re using the average of the two. On the other hand, if SOR rates plummet, it drags down the average of the two, causing you to pay less."

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