Re-financing Home Loan - Wise?

[kliee11 0]

To best calculate, get an ammortisation table. Figures do not lie, and you'll know for sure what's your savings.

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[MortgagePremier 0]

Hi,

I am with UOB for 15 years loan and on fixed rate for the 1st, 3 years. By mid of this year, my fixed rate will end. Thus, does this mean I won't be able to refinance if the amount falls below $100K? Please advise.

If not, it will be difficult to refinance, isn't it? What other option can I have?

Typically most banks would not take over the loan if the amount falls below $100k. Even if they are willing to do so, the rates offered by them are not attractive compared to what they are offering to clients whose loan amount is of the minimum threshold figure. Also if your outstanding loan amount is small, unless the interest rate differential is substantial, the overall cost savings might not be monetary beneficial to refinance.

If the option of refinance makes more sense after assessing the overall cost savings, in view of the small loan amount, it is advisable to choose a loan structure that is more suited for a long term strategy, rather than just focusing on capitalizing on the low interest rates for the first 2-3 years. Firstly, speak to UOB to see what rates and terms they are able to offer you for conversion (repricing). And from there, it would be easier to assess the overall situation on which is a more viable option. Some key points to take note for UOB packages:

1) if a fixed rate package is offered by UOB, typically after the fixed years, your package would be pegged against their board rate, which lacks transparency and gives the bank total discretion to control the rates to protect their target profit margin.

2) They only have SOR pegged rates, which is lower than SIBOR currently, but is more ideal for short term rather than long term, due to the nature of it.

Overall, we would need to look at the overall terms on your existing package, as well as what re-pricing rates and terms are offered by the bank to review and assess your mortgage portfolio as many other variable factors would play an important part as well. Feel free to PM me directly for further discussion. Thanks.

[MortgagePremier 0]

Any idea which bank offered better rate? I am thinking to refinance my condo. Have been with UOB for 2 years and past the lock in period.

I have zero idea on how to calculate the percentage that offered by bank.

Hi,

For property financing, we are looking at 3 main options:

1) Fixed Rate

2) SIBOR/SOR rate

3) Variable bank board rate

There are many variable factors to determine which housing loan structure would be more ideal for a client's mortgage portfolio. Some loan structures are ideal for short term whereas some are more for longer term strategy. It also depends on client's perceptions on how the interest environment would be reacting in the next couple of years, as well as their risk profile and financial objectives.

You can PM me your email address and I can forward you the various competitive loan structures from the whole industry and a brief explanation on the various different loan structures.I will be able to assess your overall cost savings from the different loan structures as well, to see which is a more viable option.

[mdfaz 0]

Hi, i am thinking of refinancing my HDB loan. CUrrently left 25 years at 2.6%. I worked out a financially viable plan to refinance with a bank here which is offering 1.99% (5 year fixed) and to pay off the loan within 5 years. My question is:

1.for fixed rate plans, the rate will still remain fixed right regardless if property prices crash during the period of servicing the loan?

2. Any other banks that offer better deal than this for 5 year fixed plan?

Another option is we are considering to sell off and get a new EC. Most profits from current flat will go into that EC. However, that will mean taking a fresh $550k (estimated) bank loan for 30 years and a view that property market might crash soon. Location of the EC is in tampines, an area we have been eyeing for a long time (cos MIL stays there so send my daughter will be easier and in future, we will be putting her in school in that area too).

So I'm in a dilemma... would appreciate some help. Thanks..

Edited June 10, 2011 by mdfaz

[ailsa 0]

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Edited June 11, 2011 by ailsa