A guide to Standard Chartered home loans in Singapore

There are various banks in Singapore offering customers different interest rate packages for its home loans, and it can be a confusing process for buyers when choosing a package. Where does Standard Chartered Bank (SCB) stand as compared to other banks when it comes to home loans?

Interest Offsetting Mortgage Account

An interest-offset mortgage account is a repayment account that is joined to the mortgage loan you currently own.  With this feature, customers can earn a higher interest rate in the repayment account that matches your housing loan package.

SCB offers an interest offsetting feature to customers called the MortgageOne account. For the amount deposited in the account, the first 2/3 will earn the same interest rate as the housing loan, and can be used to offset the interest on monthly loan payments.

The remaining 1/3 earns 0.25% (subject to changes), and is similarly used to offset interest on monthly mortgage payments.

Giving a simple scenario:

Total Loan Quantum$1,000,000
Interest Rate Charged for Loan1%
Loan Payment Interest$10,000
Amount Deposited$600,000
Interest Offset Per Year2/3 of deposit enjoys 1% = $4,000
1/3 of deposit enjoys 0.25% = $500
Therefore, total interest offset = $4,500
Loan Payment Interest ($10,000) – Your Total Interest Earned ($4,500) = Net Loan Interest Payable ($5,500)

The interest-offset feature allows for loan tenure to be shortened. This is because a large portion of your monthly loan installments is contributed to paying down your loan amount.

Also, since the MortgageOne is essentially a savings account, it allows customer the flexibility to withdraw your deposit whenever your wish. This is just like any other deposit account, and may be an important deciding factor for you!

There are also no processing fees involved. Do take note however that MortgageOne only applies for private residential properties and loan amounts of minimum $100,000.

Fixed Deposit Pegged Rate

As of 2016, SCB offers one set of fixed deposit pegged rate for its customer, the FDR48, making it the first foreign bank to do so. FDR offers a solution against rising interest rates, especially against rising Singapore Interbank Offered Rate (SIBOR) for customers.

However, SCB FDR 48-month fixed deposit rate has been set to rise from 0.5% to 0.9% with effect from 8th March 2018.

Before Rise in FDR48After Rise in FDR48SpreadMortgage Interest Mortgage Interest
0.5%0.9%0.8% (up till 12 Nov 2017)1.3%1.7%
0.5%0.9%1.08% (April 2017)1.58%1.98%

From the independent.sg

SIBOR Packages

SCB offers various attractive SIBOR packages. However, they do not offer loan packages with fixed rates.

SC Home Suite

SCB also offers the SC Home Suite, which is a form of private property financing for both completed properties and building under construction properties. The interest rate on this mortgage loan is calculated as follows: bank’s current fixed interest rate on its time deposit offerings(which is 0.5% as of now, but set to rise) + fixed margin. Note: Unlike FDR which is a type of rate, Home Suite is a full loan package offering (which includes a repayment account, credit card, etc).

Since the loan is offered with no lock-in period, a borrower who may have extra money in their pockets, will be able to pay down the loan without worrying over prepayment fees! You also do not have to worry over processing fees.

The SC Home Suite can offer you financing of up to 80% of the value of the property to be bought by the borrower. However, you cannot be holding any residential property loans with any banks.

One perk that the customers can opt for is a Platinum Credit Card with exclusive privileges such as

  • 24-hour Platinum concierge services
  • Golf Privileges
  • The Good Life Deals

The only requirement is a minimum annual income of S$30,000 for residents, & $36,000 for foreigners.

Online banking and mobile banking services are also offered for the convenience of customers.

HDB Home Suite

The HDB Home Suite by SCB has similar offerings (up to 80% financing) and perks to the SC Home Suite. In addition, it offers home insurance and fire insurance by MSIG Insurance (Singapore) Pte Ltd.

HDB Bridging Loan

 Looking to fund your property’s down-payment while waiting to cash in the sales proceeds from your existing property? SCB has a HDB Bridging Loan for that as well.

Customers can enjoy low fees with no monthly instalments, processing fees and upfront arrangement fees, as well as a fast application process.

The Loan is offered at a rate of 3M SIBOR + 2.00% p.a.

There is however a maximum loan tenure of 6 months. You must also be buying a flat from the secondary HDB resale market or direct from HDB.

Part Purchase Applications

SCB are more stringent on part purchase applications.

Loan Eligibility

SCB is generally more stringent on

  • loan application for leases less than 60 years.
  • loan application for properties in or near Geylang. One example is Guillemard

SCB is however more receptive in granting exceptional approval for priority customers.

Loan Disbursement

Funds do not have be deposited with SCB prior to loan disbursement.

Building Under Construction

SCB provides cheap desktop valuation for BUC Loans.

History of SCB

Standard Chartered is are nowned British multinational banking and financial services organisation, with its foreign bank headquartered in London.Today, Standard Chartered has 1700 branches across 70 different countries all around the world, including the Asia Pacific Region. It offers various financial products that caters to the ever-changing needs of its customers.

Financial products from Standard Chartered are offered across 17 branches in Singapore.  Standard Chartered also has 29 ATMS and 6 priority banking centres in Singapore.

Standard Chartered has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. It had a market capitalisation of approximately £33 billion as of 23 December 2011, the 13th-largest of any company with a primary listing on the London Stock Exchange. It has secondary listings on the Hong Kong Stock Exchange and the National Stock Exchange of India. Its largest shareholder is the Government of Singapore-owned Temasek Holdings.

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!