Banks in Singapore are known to provide very attractive interest rates packages. How does DBS compare when it comes to home loans? Here’s a list of features that are unique or beneficial to customers when it comes to applying for a home loan with DBS:
Current DBS home loan package interest rates
|Loan Package||Board||FHR8||Fixed||Fixed||Board||Fixed||3-mth SIBOR|
|Lock-in Period||2 Years||2 Years||2 Years||1 Year||2 Years||3 Years||2 Years|
Date of update : December 27, 2017
Check more rates in our loans comparison table which compares interest rates of major banks including OCBC, DBS, Maybank and more.
Home loans in DBS
On the mortgages front, DBS offers a variety of fixed and floating rate packages.
DBS was the first bank to introduce their Fixed Deposit Home Rate (FHR) in 2014. As DBS is not in need of funds, it is less likely for them to adjust the rate of the FHR. This means that the bank does not need to run any form of promotions to encourage customers to put in funds. Thus, the tendency to change FD rates might be lower. This bodes well for housing loan shoppers in Singapore because it signifies greater stability in home loan interest rates. Ultimately, FHR is still a board rate that is determined internally by the bank, as compared to rates such as SIBOR or SOR.
DBS also offers SIBOR, fixed and board rates packages. Like other banks, DBS adds a margin on top of the current SIBOR and board rates in deriving their actual interest rates offered to consumers.
Interest rates on HDB loans are transparent – at the time of writing, the DBS HDB loan is pegged to FHR 9, which refers to the prevailing 9-month SGD fixed deposit interest rate.
For HDB loans, there are no forms of penalty if you choose to prepay your loan. Learn more about HDB loans in our guide.
A minimum loan amount of S$100,000 also applies.
Types of Fixed Deposit pegged rates
There are 3 sets of rates offered with FHR – FHR 8, FHR 9, and FHR 18. Each one is pegged to the respective type of fixed deposit rates in the bank. For example, FHR9 has lower interest rate than FHR18. Each one caters to a different customer segment.
Fees and Charges
Be it signing up for a new loan or refinancing an existing loan, various fees are bound to be incurred by the applicant. Valuation and fire insurance fees are mandatory for both new loans and refinancing, whereas legal fees (including stamping fees) are applicable for new loans. Legal fees may be subsidised by the bank, either in part or in full.
DBS often offers competitive fixed rates, when compared to its counterparts. For a list and explanation of different types of bank loans including fixed rates, SIBOR and other rates, refer to our guide to best home loans.
Mortgage Interest Rate Cap
There are interest rate caps at certain amounts.
The same TDSR and MSR rules applies.
DBS is able to recognise self-employed customers as salaried workers, thus forfeiting the need for a 30% haircut on the applicant’s Notice of Assessment (NOA).
As such, self-employed applicants which includes entrepreneurs, real estate agents and the like would be able to secure a loan even with a lower income. Hence DBS mortgage loans remain a hot choice among this group in Singapore.
When it comes to your loan application with DBS, approval is fast, as long as the full set of required documents have been submitted. The speed of processing is usually dependent on the complexity of the case, but it can be as fast as a single day turnaround.
Funds that are pledged with the bank would have to be deposited prior to loan disbursement. For showing of funds or assets under management (AUM), funds have to be shown upon application and 2 weeks before disbursement.
While most banks charge a 1.5% penalty, DBS charges 1.25% on the prepaid amount, and 0.25% on the original loan amount.
DBS offers the flexibility of allowing customers to use their own existing accounts as repayment accounts.
For part purchase cases, it is necessary for customers to use the bank’s designated panel of lawyers.
However, the sales & purchase (S&P) agreement does not have to be presented upfront during the loan application.
Other loans provided by DBS
DBS also provides personal loan and business loans.
History of DBS
DBS Bank, previously known as the Development Bank of Singapore, is a banking and financial services corporation headquartered in Singapore. It was established by the Singapore government in 1968 in an effort to acquire the industrial financing responsibilities from the Economic Development Board.
Today, DBS is the largest Southeast Asian bank, and as of 31 Dec 2016, the company reported assets worth a total of S$482 billion. In Singapore alone, there are over a hundred branches, and its international presence stretches across 18 markets in Asia, Dubai, the United Kingdom and the United States. In markets other than Singapore, the bank’s focus is on three lines of their business, namely: wealth management, corporate/investment banking, and SME banking.
In November 1998, DBS acquired POSB Bank, and this acquisition enabled customers of both banks to share banking facilities such as ATMs and cash deposit machines.
Last but not least
When availing yourself of any home loan, it is important to look at combination of various factors. Cheapest bank loan may not always be the best one. If unsure, always check with a trusted expert!