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By: Zeng Han Jun, CPCG, Singapore


There are many different reasons why home owners want to refinance. Some want to go for a lower interest rate, some want a fixed rate and others want to tap on the equity of their house.

Whatever that reason may be, remember that making even the slightest change to your mortgage can affect your current finance greatly. Make the right decision and you can live in peace with that new mortgage for the next few years.

Take a look at your interest rate


Do not be surprised that many people often lose track of their mortgage’s interest rate few months after the closing. People just pay, pay and pay their monthly installments without checking because they are too caught up in their work. It will be too late by the time you realized that monthly debt installments exceeds your current salary. Do not rely on your financial advisors or private bankers to remind you about your mortgages. Turnover rate in the banking industry is extremely high. Your private banker might just become a car salesman months after he just helped you with a transaction – just a statement, no harm intended! Try to set a reminder in your hand phone or organizer, telling you to take a look at your interest rate once a year.

SIBOR, SOR, CPF or Board Rates?


Different kinds of mortgage products are sprouting from the banking industry and that makes choosing a mortgage a tad more difficult than before. You have different kinds of benchmark rates: SOR, SIBOR, CPF and Board Rates. Which one should you take? Ultimately the decision lies with you. Different kind of rates displays unique behaviors. Some are more stable, and some sloshes up and down in a matter of months. Maybe you prefer a stable interest rate, but it may so stable that it does not adjust downwards when all other rates are going down. Think about this for a moment…

How long are you going to stay in this home?


This is a VERY IMPORTANT factor that must be considered before taking up of any mortgages. Will this house be your retirement home? Having a hunch that you will be gaining a hefty profit margin from this house few years down the road? Being very clear on this issue will enables you to make a decision on how you want to structure your loan. If you think it will turn out to be a good investment, why not try going for an interest only mortgage?



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There are many different reasons why home owners want to refinance. Some want to go for a lower interest rate, some want a fixed rate and others want to tap on the equity of their house. Whatever that reason may be, remember that making even the slightest change to your mortgage can affect your current finance greatly. Make the right decision and you can live in peace with that new mortgage for the next few years.

Do not be surprised that many people often lose track of their mortgage's interest rate few months after the closing. People just pay, pay and pay their monthly installments without checking because they are too caught up in their work. It will be too late by the time you realized that monthly debt installments exceeds your current salary. Do not rely on your financial advisors or private bankers to remind you about your mortgages. Turnover rate in the banking industry is extremely high. Your private banker might just become a car salesman months after he just helped you with a transaction - just a statement, no harm intended! Try to set a reminder in your hand phone or organizer, telling you to take a look at your interest rate once a year.