DBS OCBC UOB raise fixed home loan rates to up to 4.5%: What home buyers need to know
DBS OCBC UOB raise fixed home loan rates to up to 4.5%: What home buyers need to know. DBS Bank, OCBC Bank, and UOB increased their fixed-rate packages on Tuesday, pushing home loan rates beyond 4%. UOB now has the highest rates of the three local banks, with its two-year fixed-rate package at 4.5 percent per year.
DBS offers two- to five-year fixed-rate packages at 4.25 percent per year, while OCBC offers one- and two-year fixed-rate packages at 4.3 percent. According to a DBS spokeswoman, many customers are still opting for fixed-rate contracts in anticipation of further rate hikes in the United States. As a result, the bank is now offering three to five-year loans, giving customers the opportunity to lock in fixed rates for a longer period of time.
Ms Maryanne Phua, OCBC’s head of home loans, stated that popular demand compelled the bank to reintroduce fixed-rate packages, which were temporarily removed from the market in late October. She claims that this enables clients to choose the tone that best suits their needs. Singapore fixed home loan rates are currently higher than the 4% medium-term interest rate floor set by the Monetary Authority of Singapore (MAS), which is used to determine the loan amount that an individual can qualify for. As interest rates rise, the medium-term interest rate floor structure ensures that consumers continue to borrow or take out loans prudently.
Even though recent home loan rates have risen beyond the 4% ceiling, consumers need not be concerned about paying more than they can afford. This is due to the fact that OCBC already uses a higher interest rate of 4.5 percent to determine the maximum loan amount that a property owner can borrow, whereas DBS uses 4.25 percent. As a result, homeowners will be able to borrow a smaller loan amount while still meeting the overall debt servicing ratio criterion, which states that a borrower’s total debt obligations cannot exceed 55% of his monthly income.
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