Season’s greetings to all our readers! Hope you are having a restful and joyful time with your family and friends.
I’m sure you feel the same way as we do about the pace in Singapore. Fast, faster and even faster if possible.
The year flew by so quickly and before we knew it, we are hitting the end of 2014! That also reminded us that we have not been updating as frequently in this space as we would like. Many apologies for that!
It’s been an exciting second half of the year, and we are taking this opportunity to share with you what’s been going on in the mortgage scene aka gladiator arena. Yes, it’s been brutal.
- Many Foreign banks started removing fixed interest rates, and we highly suspect that they are unable to commit to these rates, predicting that rates will be on an uptrend in the coming years.
- Spreads (which is what the bank earns) for floating rates have been steadily increasing. We know banks have been seeing red with the tight earnings from low loan interests. The slowdown in the property market is a double whammy for them and the only way to keep business afloat is to increase their margins.
- There banks have been changing the packages quite often in the past quarter to better adjust to the market’s supply and demand. What this means to us who are trying to refinance or obtain new loan is that the bank keeps flipping like the prata being cooked, and EVERY promotion can be stopped or changed anytime.
- TDSR is a deadly disease that has striked many people who needs a new loan/to refinance their loans badly. Those who have issues and are facing an increase in interest rates, needs to restructure their loan but cant, as their income/age do not meet the regulated criteria. (so they say, the poor gets poorer). We get close to 40% loan application rejection rate these days which is pretty high. We think it would get worse when more credit issues surfaces and the regulation continues to be inflexible towards people who really need help.
- Banks have also become selective in the properties they are willing to take in as collateral. Hence, not every property can get a new loan or refinanced.
With all these situations on hand, we’ve thus been busy finding solutions and working closely with the banks to find out how these issues can be addressed.
There are many factors involved and each situation is different. What we can do is to try our best to advise each client ways to overcome such issues and minimize their housing loan interest and debt through our experiences.
If you are wondering if you would be encountering any of the abovementioned situations, and worried about what your next interest rate will be for your loan, or even be in the midst of the above-mentioned problems, do drop us a note, and we will be happy to have a chat with you. Just remember to throw in a cup of coffee if we do get to help. =)