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DBS Home Loan Review: Fixed vs Floating, SORA, BUC Packages and More (2022)

DBS Home Loan Review: Fixed vs Floating, SORA, BUC Packages and More (2022)     
DBS Home Loan Review: Fixed vs Floating, SORA, BUC Packages and More (2022)

Founded in 1968 by the Government of Singapore to initially finance the industrial activities of the Economic Development Board, today, DBS is one of the largest banks in Southeast Asia.

As the largest bank in Singapore, DBS has one of the highest deposit accounts and a strong presence in the local home loan market. In this guide, we take a look at the home loan packages offered by DBS for both HDB flat and private property owners.

In November 2022, the US Fed raised interest rates by another 75 basis points, taking its federal funds rate to a range of 3.75% to 4%. In response to rising interest rates, banks have also raised their mortgage rates. Alongside other major banks, DBS raised the rates on its fixed rate home loan packages to 4.25% p.a. on 15 November 2022.

DBS also has a new home loan package that enables new and existing HDB flat owners earning less than $2,500 per month to apply for a POSB mortgage at 2.6% annually.

Disclaimer: The packages mentioned in this article are correct at the time of writing (17 November 2022) and are meant as a guide only. The interest rates are subject to change, and you should compare the latest home loan rates and packages on PropertyGuru Finance before applying for a new home loan.

DBS Home Loan Summary

DBS home loan summary

Type of home loan

BUC Home Loans

Get in touch with DBS to find out more

Floating Rate Home Loans

DBS 2-Year (3M SORA) or 3-Year (CHR) Floating Rate

Fixed Rate Home Loans

DBS 2-, 3-, 4-, 5-Year Fixed Rate

Here’s an in-depth look at the different available under all three categories: fixed rate loans, floating rate loans and BUC loans.

DBS Fixed Rate Home Loans

Currently, DBS offers four fixed rate packages:

  • DBS 2-Year Fixed Rate Package

  • DBS 3-Year Fixed Rate Package

  • DBS 4-Year Fixed Rate Package

  • DBS 5-Year Fixed Rate Package

Here were the previous fixed rates for these packages:

Year

DBS 2-Year Fixed Rate

DBS 3-Year Fixed Rate

DBS 4-Year Fixed Rate

DBS 5-Year Fixed Rate

Year 1

4.25%

4.25%

4.25%

4.25%

Year 2

4.25%

4.25%

4.25%

4.25%

Year 3

3M SORA + 1.00%

4.25%

4.25%

4.25%

Year 4

3M SORA + 1.00%

3M SORA + 1.00%

4.25%

4.25%

Year 5

3M SORA + 1.00%

3M SORA + 1.00%

3M SORA + 1.00%

4.25%

Thereafter

3M SORA + 1.0%

3M SORA + 1.00%

3M SORA + 1.00%

3M SORA + 1.00%

The 2-, 3-, 4-, and 5-year fixed rate packages have an interest rate of 4.25% p.a. and a lock-in period for the specified number of years, respectively. Previously, DBS had a 5-year fixed rate home loan pegged to the Fixed Deposit Home Rate 6 (FHR6), which is the prevailing six-month Singapore Dollar fixed deposit rate of DBS for amounts of $1,000 to $9,999 (or any other sums stated in the letter of offer); this package has since been scrapped.

Instead, the offered fixed rate packages are pegged to the 3M SORA, which is the Singapore Overnight Rate Average, defined by the Monetary Authority of Singapore as the “volume-weighted average rate of borrowing transactions in the unsecured overnight interbank SGD cash market in Singapore between 8am and 6.15pm”.

All mortgage rate packages have a minimum loan amount of $100,000. Only the 5-year fixed rate package offers the perk of a waiver due to the sale of the property after 36 months.

Previously, the rates were pegged to SIBOR. Now that SIBOR is gradually being phased out, SORA is a popular reference rate for floating rate home loans. You can read more about it in this article: SIBOR vs SOR vs SORA: What Do These Rates Mean for Your Home Loans? For the latest DBS fixed deposit rates, click here instead.

DBS Floating Rate Home Loans

For completed properties, let’s start with the DBS floating rate home loans available. There are two floating rate packages currently, tied to the CPF Home Rate (CHR) or 3M SORA.

Current floating rates for DBS (as of 17 November 2022):

Year

DBS 3-Year Lock-in CHR + 0.10%

DBS 2-Year Floating Rate 3M SORA + 1.00%

Year 1

CHR + 0.10%

3M SORA + 1.00%

Year 2

CHR + 0.10%

3M SORA + 1.00%

Year 3

CHR + 0.10%

3M SORA + 1.00%

Thereafter

CHR + 0.10% p.a.

3M SORA + 1.00%

The DBS floating rate packages come with the option of a 2-year or 3-year lock-in period. The 2-year floating rate package has a 3M SORA + 1.00% interest rate.

There is also a 3-year floating rate package pegged to the CHR. The CHR is based on the prevailing CPF Ordinary Account (OA) interest rate. Currently, the CPF OA interest rate is 2.5%. It has a spread of 0.10%. This package is only eligible for new and existing HDB flat owners with a gross monthly income of $2,500 and below.

All floating rate packages have a minimum loan amount of $100,000.

DBS also offers a Two-In-One home loan package, which is usually lower than a fixed-rate loan package. This hybrid home loan package allows borrowers to have up to half of their loan amount under a fixed rate package, while the rest of their loan is under a floating rate package, subject to special rates.

DBS BUC Home Loans (For Residential Properties under Construction)

For more information on the DBS BUC home loan, check out the DBS webpage. Looking for a BUC loan? Compare the best BUC loans on PropertyGuru.

DBS Home Loan Review: Should You Consider It?

There are many home loan packages out there, but what makes DBS home loan packages worth your consideration? Here are a few reasons why you could consider taking a DBS home loan package.

More Competitive than HDB Interest Rates

Compared to HDB concessionary rates of 2.6%, DBS’ floating rate packages are still more competitive. So, if you’re an HDB flat buyer or owner, it’s definitely worth considering. This translates to sizeable savings in the monthly instalments over the home loan lock-in period of two to three years.

Extra Savings with DBS Multiplier Account

The final reason to take up a DBS home loan is to take advantage of the Multiplier Account – a savings account that many Singaporeans have. Taking up a home loan package from DBS fulfils one of the categories for the Multiplier Account, which allows a DBS depositor to earn a higher interest rate on their savings.

From time to time, there may also be promotional rates offered by DBS and other banks. This can make a seemingly less superior package become more suitable and cheaper for you. To help you find the best home loan packages, you can use the PropertyGuru Finance home loan calculator or speak to one of our mortgage experts.

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Disclaimer: Information provided on this website is general in nature and does not constitute financial advice.

PropertyGuru will endeavour to update the website as needed. However, information can change without notice and we do not guarantee the accuracy of the information on the website, including information provided by third parties, at any particular time. Whilst every effort has been made to ensure that the information provided is accurate, individuals must not rely on this information to make a financial or investment decision. Before making any decision, we recommend you consult a financial planner or your bank to take into account your particular financial situation and individual needs. PropertyGuru does not give any warranty as to the accuracy, reliability or completeness of information which is contained on this website. Except insofar as any liability under statute cannot be excluded, PropertyGuru and its employees do not accept any liability for any error or omission on this website or for any resulting loss or damage suffered by the recipient or any other person.