Home Mortgage Refinance
Switch to a better home loan rate and save thousands in interest. Learn when refinancing makes sense and how to do it right.
What is Mortgage Refinancing?
Refinancing means replacing your existing home loan with a new one, typically from a different bank. The new loan pays off your old loan, and you continue with new terms (usually lower interest rates).
Typical rate reduction when refinancing
Potential savings over loan tenure
Typical refinancing cycle
Real Savings Example
A $400,000 loan refinanced from 4.0% to 3.5% saves approximately $200/month. Over a remaining 20-year tenure, that's $48,000 in savings (minus refinancing costs of ~$3,000).
When Should You Refinance?
Good Time to Refinance
Lock-in Period Ended
Your current lock-in period has expired (usually 2-3 years)
Rate Difference > 0.5%
New rates are at least 0.5% lower than your current rate
Significant Loan Balance
At least $200,000 remaining to justify refinancing costs
Rate Type Switch
Want to switch from floating to fixed (or vice versa) based on market outlook
Not Ideal to Refinance
Still in Lock-in
Penalty (1.5% of outstanding) usually outweighs savings
Small Loan Balance
Refinancing costs may exceed interest savings on small loans
Minimal Rate Difference
Less than 0.3-0.5% difference rarely justifies the effort
Refinancing Costs
Refinancing involves fees that you need to factor into your savings calculation.
| Cost Item | Typical Amount | Who Pays |
|---|---|---|
| Legal Fees | $2,000 - $3,000 | Often subsidized by new bank |
| Valuation Fee | $300 - $500 | Buyer or bank |
| Early Redemption Penalty | 1.5% of loan (if in lock-in) | Buyer |
| Clawback of Subsidy | Varies | Buyer (if refinancing too soon) |
Bank Subsidies
Many banks offer legal fee subsidies ($2,000-$3,000) to attract refinancing customers. Some even cover valuation fees. Always ask about available subsidies when comparing.
The Refinancing Process
Check Lock-in Status
Review your current loan letter. Note when lock-in ends and any clawback conditions.
Compare Offers
Get quotes from multiple banks (3-5 minimum). Consider rates, lock-in period, subsidies.
Apply for New Loan
Submit application with income documents. Bank will conduct credit check and valuation.
Receive Offer Letter
Review terms carefully. Accept within validity period (usually 14-30 days).
Legal Process
Lawyers handle the transfer. Takes 2-3 months from acceptance to completion.
Completion
New loan pays off old loan. Start payments to new bank from completion date.
Refinancing vs Repricing
Repricing is switching to a different loan package with your current bank. It's simpler and cheaper than refinancing but may not offer the best rates.
Refinancing
- • Switch to different bank
- • More competitive rates
- • Higher costs ($2,000-$3,000)
- • Longer process (2-3 months)
- • New legal documentation
- • Can get subsidies from new bank
Repricing
- • Stay with current bank
- • Limited to bank's current packages
- • Lower costs ($500-$800)
- • Faster process (1-2 weeks)
- • Simple paperwork
- • No subsidies typically
Tips for Successful Refinancing
Start 3 Months Early
Begin comparison shopping 3 months before lock-in ends. Rates offered may only be valid for limited time.
Negotiate
Banks want your business. Use competing offers to negotiate better rates or higher subsidies.
Read the Fine Print
Check clawback clauses for subsidies. Some require you to stay for 2-3 years to keep the legal fee subsidy.
Calculate True Savings
Factor in all costs, not just rate difference. A slightly higher rate with more subsidies might save more overall.
2026 Bank Refinancing Rates Comparison
Below is a comparison of refinancing rates offered by major banks in Singapore as of Q1 2026. Rates are subject to change; always verify with banks directly.
| Bank | Fixed Rate (2-3 yr) | Floating Rate (SORA) | Lock-In Period | Legal Subsidy |
|---|---|---|---|---|
| DBS | 2.75% - 3.25% | SORA + 0.80% | 2 years | Up to $2,000 |
| OCBC | 2.80% - 3.30% | SORA + 0.75% | 2 years | Up to $2,500 |
| UOB | 2.70% - 3.20% | SORA + 0.85% | 2-3 years | Up to $2,000 |
| Standard Chartered | 2.65% - 3.15% | SORA + 0.70% | 2 years | Up to $3,000 |
| Citibank | 2.75% - 3.25% | SORA + 0.80% | 2 years | Up to $2,500 |
| Maybank | 2.85% - 3.35% | SORA + 0.90% | 2 years | Up to $1,500 |
Understanding SORA Rates
SORA (Singapore Overnight Rate Average) replaced SIBOR as the benchmark for floating-rate loans. As of Dec 2024, 3M SORA was around 3.0-3.2%. SORA + spread packages typically have total rates of 3.7-4.0% in current market conditions.
Rate Validity Notice
Rates shown are indicative as of January 2026. Banks update rates frequently based on market conditions. Always request a formal quote from multiple banks for accurate comparison.
Frequently Asked Questions
How often should I refinance?
Every 2-3 years when lock-in ends is typical. Set calendar reminders to review your loan before lock-in expires.
Can I refinance an HDB loan to a bank loan?
Yes, you can refinance from HDB loan to bank loan if bank rates are lower. However, you cannot go back to HDB loan once you switch to bank.
Will refinancing affect my credit score?
Slightly and temporarily. Multiple loan inquiries within a short period (rate shopping) are typically counted as one inquiry by credit bureaus.
Can I extend my loan tenure when refinancing?
Yes, subject to age limits (loan + age typically cannot exceed 65-75 years). Extending tenure lowers monthly payments but increases total interest paid.
Sources and further reading
Official sources and references for rules, rates, and schemes discussed on this page. Numbers on this site may be rounded or illustrative; confirm current terms with the relevant agency, CPF Board, insurer, or lender.
- MAS — property loan rules Framework for residential property financing. MAS — Macroprudential policies
- MoneySense — home loans Consumer education on home loans and refinancing. MoneySense — Home loan basics