DBS Group, one of the leading financial services groups in Asia, has introduced three new mortgage packages to attract home buyers seeking to benefit from the current low interest rates.
Pegged to the three-month Singapore Interbank Offered Rate (SIBOR) plus a spread, the first package provides a mortgage rate capped at 1.49 percent for the first three years. This is designed to offer borrowers some level of protection and stability against impending SIBOR increases.
The second product is pegged to the one-month SIBOR plus a spread, with the benchmark rate to be refreshed every three months. DBS is the first bank in Singapore to devise such an arrangement and it hopes that home buyers will benefit from a lower SIBOR rate at less volatility.
Home buyers who obtained a mortgage insurance known as My Protector Mortgage can enjoy lower spreads on floating-rate mortgages.
Furthermore, DBS also offers a three-year fixed rate mortgage. Home buyers who obtained the mortgage insurance on top of this can enjoy the market’s lowest rate of 1.38 percent. Without the mortgage insurance, the fixed rate would be 1.48 percent.
Meanwhile, Swap Offer Rates (SORs) have turned negative, prompting some banks to stop providing SOR-pegged mortgages. The three-month SOR stands at -0.05104 percent as of last Friday.
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