Mortgage Refinance

REFINANCE YOUR HOME LOAN

Most banks structure their home loans using step up rates. This means that the Singapore home loan rates tends to become higher in the later years of the loan.

Many people tend not to think of their mortgages once they sign up the first time. The cost is not very noticeable, but it can be a lot over a few years.

Illustration of Savings with Refinancing your Housing Loan:

800,000 Outstanding loan

Interest rate: 3.5% fixed for 3 years.
Tenor: 30 years

Year	Mthly Installment	Principal Paid (For the month)	Interest Paid (For the month)	Total Principal Paid (For the year)	Total Interest Paid (For the year)	Balance
1	$3,592.36	$1,300.01	$2,292.35	$15,353.02	$27,755.27	$784,646,98
2	$3,592.36	$1,346.25	$2,246.11	$15,899.08	$27,209.21	$768,747.89
3	$3,592.36	$1,394.13	$2,198.23	$16,464.57	$26,643.72	$752,283.33

The Interest paid over 3 years is $81,608

If you are able to refinance your loan to a lower rate, for example:

Year 1 – Sibor + 1% (Where Sibor = 0.5%) = 1.5%
Year 2 – Sibor + 1% (Assume that Sibor = 1%) = 2%
Year 3 – Sibor + 1% (Assume that Sibor = 1.5%) = 2.5%

Year	Mthly Installment	Principal Paid (For the month)	Interest Paid (For the month)	Total Principal Paid (For the year)	Total Interest Paid (For the year)	Balance
1	$2,760.96	$1,785.33	$975.63	$21,277.43	$11,854.11	$778,722.57
2	$2,950.84	$1,683.53	$1,267.31	$20,018.45	$15,391.61	$758,704.12
3	$3,142.08	$1,597.61	$1,544.48	$18,953.58	$18,751.41	$739.750.55

The Interest paid over 3 years is $45,997.13

The savings over 3 years is:

$81,608 – 45,997.13 = $35,610.87

Singapore’s Condo dwellers average household income is around $11,500 according to Singapore statistics.

This means an annual income of $138,000.

A Savings of $35,610.87 is around 26% of your household income.

Why waste this money when it could have paid for your wife’s 2 carat diamond ring or alternatively be the down payment for your new car.

REFINANCE VERIFICATION

Property Buyer Mortgage Consultants will check if and whether you will derive any savings from refinancing. If you are unlikely to get much savings, we will let you know.

CAN I GET CASH-OUT FROM BY PROPERTY?

Yes, if your property is a Private property, it is technically possible to get CASH OUT from the property. CASH OUT is also called Term Loan or Equity Loan. We can help you borrow CASH from your property.

However Cash borrowed this way cannot be used for downpayment into your next property.

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