Wouldn’t it be great if you and your partner if you are going to begin a new life together in a new house? We all want that, that dream house with our dream man. But it’s not as easy as that. Unless you have tens to hundreds of thousands of cash lying around somewhere, buying your dream house may take you decades. Saving with your honey would accelerate the process, but would still take a long time before you can actually buy a home. That is precisely why we have home loans.

Housing loan is like saving for the house you already live in. There’s no need to wait ages any longer. But before you and your sweetheart get too excited and pick out a house, see first the most practical one you two can afford. It is a loan, true, which means you would be saddled with the payments for the better part of your life so it’s better to pick out the one that is light in the pockets. Be prepared to have a large piece of both of your salaries taken out to keep up with the payment.

Before moving to a larger couple’s place, save for the down payment while you are still living separately. There are houses available that don’t require deposit, but paying the fee upfront would give you a smaller monthly cost.

Beginning a new life with each other calls for tying loose financial ends individually. From the cost of your engagement ring and wedding rings to the wedding event itself and the honeymoon trip, everything reeks of dollars. Unless you paid cash, you surely have been left with a lot of credit card debts. Clear them up before taking the next step. It’s best to eliminate them completely or even reduce them significantly if you can before blending your interests together. Husbands and wives with high debt may get a tougher time being accepted for a home loan. Also, because mortgage lenders take your debts into account, you may wind up with higher interest rate.

To help you see a different view, ask a house loan advisor for advice. It won’t hurt to ascertain the price range you can comfortably pay and afford before picking out your home.

Keep in mind that your assets and liabilities affect the outcome of your house loan. You will most likely wind up with low housing loan if you have more liabilities than assets. You and your partner’s records will be considered and reviewed during your application.

As brought up, before committing to a major mutual buy, it is best that both of you resolve your own financial matters first. Buying a house will take the better part of your lives paying for it, so make certain both of you are truly committed to that long-term responsibility.

Find out more about a premier housing loan advisory firm, providing housing loans with free mortgage broking.

Congratulations! You have now achieved financial capability to be able to buy a home. So, you fell in love at first sight at a dwelling set in a certain neighborhood that you feel will be close to perfect in raising a family in your near future.

All the same, this is not the moment to act impulsively. Before you apply for that housing loan or pay off the down payment with your hard-earned money, you have to closely look at a few matters. After all, purchasing a home is going to be the greatest expenditure you will make in your life. This is not something that you could effortlessly back off from when the paperworks are already signed.

In planning to purchase a first house, most individuals are controlled by their feelings. These individuals have a tendency to have a blind spot for serious matters regarding the structure they think is already the house of their dreams. So, after moving in and after experiencing first hand the outcomes of these issues, they become frustrated and angry at their decision.

So, to avoid being disillusioned and angry, here are the important matters to look into prior to buying your first house.

1. Consider the neighborhood

During initial visit to a neighborhood, you had an impression that it’s welcoming and quite. If preparing to purchase a house, try visiting the neighborhood at different times of the day to see the overall comings and goings in the locality.

2. Consider the community

We know that we can safely raise our kids in a community where neighbors take care and look out for each other.

3. Consider the structural defects

What you are looking at could already be your dream house. Nevertheless, it is still best to check the house for signs of defects, plumbing issues, or the presence of pest infestations.

4. Consider the space

Since most of the time people buy their first house because they are starting their own families, they must ensure that their home has enough space for additional family members.

5. Consider the price

Your banking institution or loan agent will determine the total amount they will be ready to loan you based on your income, your credit track record, your employment history, among others. You have to obtain a pre-approval on your mortgage in order to know if you can afford to buy the house you’ve set your heart on.

Find out more about a premier housing loan advisory firm, providing housing loans with free mortgage broking.

When it comes to mortgages, many people do not refinance. A fundamental number are unaware they have the option of changing their loan to different financier; others are simply indifferent. They stick with their very first lender and the “reward” for such loyalty tends to be higher interest rates. Due to the order of magnitude of housing loans and the tenure that the housing loan is amortised over, the interest we are speaking about here can well stretch from 1000’s to 100,000’s of dollars. Take a look at the following components to see whether it’s time for you to consider refinancing.

Current Mortgage Interest Rate

It is definitely a good indication for you to explore refinancing when your current interest rate is higher than available mortgage packages on the market. A first step to take is to go back to your current banking company or financial institution and ask them to revise your package, otherwise known as repricing. If your lender comes back with an offer, it will usually be better than your current one. You can then compare this offer with offers from other lenders to see whether you should switch or stay put.

Lock-in and Clawback Periods

When you take up a mortgage, there may be a lock-in period where your housing lender will charge you a penalty fee, normally a percentage of your outstanding loan amount, if you were to fully repay your loan. Almost all loans also come with a clawback period where the lender will claim back “freebies”, such as legal expenses, that they “gave” you when you take up your housing loan (Note: lock-in period is separate from clawback period). It may not be commendable for you to refinance due to such costs.

Loan Quantum

The larger your home loan amount, the greater your savings for the same decrease in interest rates. For example, 1% on a loan of S$100,000 is much less than 1% on a loan of S$500,000. However, fixed cost to refinancing, which represents mainly of legal fees, do not vary much with loan quantum. The difference between your existing and refinancing interest rates, therefore, has to be bigger for a relatively smaller home loan as fixed cost eats into a more fundamental part of your interest rate savings.

Perceived Interest Rate Movements

Your view on how interest rates is moving can be a factor when considering whether you should refinance. If you are presently on a fixed rate package and believe interest rates are dropping, you may want to refinance to a floating rate package. Conversely, if you are on floating rates and believe interest rates are rocketing, converting to fixed rates may be a good choice.

Individual Financial Assessment

If there is a change in your financial state, you may want to change your package particulars via refinancing. For example, you are beginning your own business organization and do not want unpredictability in other areas. Give some thought to taking up a fixed rate package. Maybe you want cash to invest in another place. Consider raising your loan quantum. Or your monthly income has increased and you want to minimise interest loan payments. Contemplate reducing your loan tenure.

If looking through this article is giving your a headache or you simply want to save yourself the trouble, contact us for a non-obligatory home loan interview. Our professional consultants not only frees up your time but also do not charge any fees to help you get the best deal. Refinancing does not have to be a irksome procedure.

Find out more about a premier Housing Loan advisory firm, providing Housing Loans with free mortgage broking.

Many people are unaware that they have the option of switching their loan to other investor; others are simply uninterested. They tend to be loyal with their very first lender but they don’t know that such loyalty will bring higher interest rates. Because of increasing number of housing loans and amortization period, the interest can range from thousands to hundreds of thousands of money. The following factors may help you consider reinvesting your home.

Current Interest Rate

When your current interest rate is higher than available housing loan packages on the market, it is time for you to consider reinvesting. Go back to your current bank or financial institution and ask them to reprice your loan package. Your lender might give you an offer. Try to compare this offer to the other packages and then decide if you should switch or not.

Lock-in and Clawback Periods

When you get a housing loan, there may be a lock-in period wherein your mortgage lender will charge you a penalty fee, maybe a percentage of your outstanding loan amount, if you were to fully repay your loan. Many housing loans have drawback period. This is when the lender will take back what they gave you when you get your housing loan. Lock-in period and clawback period are different from each other. Thus, it is not advisable for you to reinvest due to these extra costs.

Loan Quantum

The higher the amount of your loan, the greater your savings for the same decrease in interest rates will be. Yet fixed cost to reinvesting does not vary much with quantum loan. The difference between your latest and reinvesting interest rates has to be larger for a relatively smaller loan as fixed cost consumes into a more considerable portion of your interest rate savings.

Distinguish Interest Rate Movements

Your analysis on how interest rates are moving can be a factor when considering whether you should reinvest. If you are currently on a fixed rate package and believe interest rates are dropping, you may want to reinvest to a floating rate package. However, if you are on floating rates, try to switch in fixed rates if the interest rates are increasing.

Personal Financial Evaluation

Give some thought to take fixed rate package. Think of increasing your loan quantum. When your monthly income increased and you want to decrease interest payments, try to reduce your loan tenure.

Learn more about a premier Housing Loan advisory firm, providing Housing Loans with free mortgage broking.

Once you decide to avail a mortgage, the immediate matter that storms your head is choosing between fixed and floating rate of interest. It is easy to get stuck at this point if you are not financially trained.

Usually, when the media splashes reports on banks increasing home loan interest rates in and their affect on Monthly Installments, you deem it better to opt for fixed housing loan rates. In fact, your banker may also propose you to go for the same.

Now ideally as it should be, we take for granted that once you select fixed rate plan for yourself the rate of interest will remain unaltered for the entire period you have fixed the interest rate for irrespective of any subsequent increase in the same. But in reality this is not necessarily the situation.

Here we demystify the nature of fixed interest rate housing loan transaction for you so that you can make an knowledgeable conclusion over the matter.

* Check the small print of a loan. The bank has the right to give you 30 or 60-days notice that it intends to increase its rates.

* The bank’s first-year rates are binding on the bank only for that short period of 1 or 2 months. The 2nd-year home loan rates are not binding at all. Neither are the bank’s 3rd-year loan rates.

* Force Majeure Clause

So, while you read your housing loan contract, you can spot clauses like this:

“Provided further that from time to time, the bank may in its sole discretion alter the rate of interest suitably and prospectively on account of change in the internal policies or if unforeseen or extraordinary changes in the money market conditions take place during the period of the agreement.”

This is called Force Majeure Clause that enables the lender to undertake appropriate modifications in the interest rates on home loans they sanction to their borrowers.

So remember to look at refinancing every couple of years so that you do not pay too much. If you select a good housing loan company you can save a lot of money over the life of your mortgage and in almost all cases the consulting cost is free.

In Singapore, housing loan packages have two categories: fixed rates or floating (variable) rates.

Fixed rates are sometimes extended for up to 3 years. However, other lenders can go up to 5 years or 10 years. In many Western countries, fixed rates can be made throughout the loan tenure.

Floating rates can be classed into published rates or board rates. Like Singapore Interbank Offered Rate (SIBOR) or Singapore Swap Offer Rate (SOR), published rates are normally rates that are released daily. Meanwhile, board rates are defined by the respective bank or financial institution. Many of the lenders posted their board rates to a certain financial benchmarks, yet the exact factors are sometimes not clear and variations in board rates become uncertain.

There are no limitations for emigrants applying for housing loans. Still, the following constituents should be studied.

Loan to Value

The maximum loan to value (LTV) in Singapore is 90% of the purchase price or valuation, whichever is lower. Some lenders do not give maximum LTV to emigrants, thus, housing loan packages for 90% financing are limited. Loan approval for 90% financing is also tighter than for LTV 80% and below.

Income Proof

To receive commnedation for a housing loan your latest income tax assessment or a letter of appointment from your local employer is required. Some local lenders do not honor tax assessments from other countries.

Landed Property

Before an emigrant can purchase restricted properties like vacant lot or landed properties such as bungalows, semi-detached, and terrace houses, the commendation from Singapore Land Authority is mandatory.

In-principle Approval

Try to apply for an in-principle approval before moving with a purchase, since loan applications are more complicated for emigrants. Consider to hire a honored and professional housing loan consultant. This may help you save time and money with your loan approval.

Even though refinancing a mortgage can save you 1000’s of dollars you will be dumbfounded that not that many individuals actually take the time to do it. If you considered the time it requires and calculate the cost saving benefits and equate that to how much you get paid per hour it could be like not going to work for several weeks. Consider the following aspects so that you can see how easy it is to refinance your housing loan today.

Current Mortgage Interest Rate

It is decidedly a good indication for you to explore refinancing when your current interest rate is higher than available home loan packages on the market. A first step to take is to go back to your existing banking company or financial institution and ask them to revise your package, otherwise known as repricing. If your lender comes back with an offer, it will ordinarily be better than your existing one. You can then compare this offer with offers from other lenders to see whether you should switch or stay put.

Lock-in and Clawback Periods

When you take up a housing loan, there may be a lock-in period where your mortgage lender will charge you a penalisation fee, normally a percentage of your outstanding loan amount, if you were to fully repay your mortgage. Almost all housing loans also come with a clawback period where the lender will claim back “freebies”, such as legal expenses, that they “gave” you when you take up your mortgage (Note: lock-in period is separate from clawback period). It may not be worthwhile for you to refinance due to such costs.

Loan Quantum

The larger your housing loan amount, the greater your savings for the same decrease in interest rates. For instance, 1% on a loan of S$100,000 is much less than 1% on a loan of S$500,000. However, fixed cost to refinancing, which represents mainly of legal fees, do not vary much with loan quantum. The difference between your existing and refinancing interest rates, therefore, has to be bigger for a relatively smaller housing loan as fixed cost eats into a more significant portion of your interest rate savings.

Perceived Interest Rate Movements

Your view on how interest rates is moving can be a factor when thinking whether you should refinance. If you are currently on a fixed rate package and think interest rates are dropping, you may want to refinance to a floating rate package. Conversely, if you are on floating rates and believe interest rates are skyrocketing, changing to fixed rates may be a good choice.

Personal Financial Appraisal

If there is a change in your financial state, you may want to change your package details via refinancing. For example, you are starting your own business organisation and do not want volatility in other areas. Give some thought to taking up a fixed rate package. Maybe you want cash to invest in another property. Consider increasing your loan quantum. Or your monthly income has increased and you want to minimise interest loan payments. Consider reducing your loan tenure.

Consider calling us today if you are looking for refinancing in Singapore. We can save you a lot of money plus give you the latest advice all for free.