DBS doing National Service

‘Thousands of HDB homeowners are turning to DBS Bank for a mortgage product that guarantees savings.

Those who took up a POSB HDB loan when it was launched in April could be looking at savings of as much as $1,600 by next month, calculations from DBS showed.…

The first POSB HDB loan pilot launch – where homebuyers enjoyed a floating-rate loan with interest capped below the HDB concessionary rate for 10 years – was fully sold.
The bank is now into its second offering, which charges the same rate but for eight years, said Ms Lui.

The current POSB HDB loan charges for the first eight years the three-month Sibor (Singapore interbank offered rate) plus 1.38 per cent, capped at the CPF Ordinary Account rate. The current CPF Ordinary Account rate is 2.50 per cent.
Thereafter, the loan charges three-month Sibor plus 1.48 per cent. The September three-month Sibor is 0.374 per cent.

The HDB concessionary loan now charges 2.60 per cent, which consists of 0.10 per cent plus the CPF Ordinary Account rate of 2.50 per cent. Based on the three-month Sibor of 0.38 per cent, borrowers who switch from the HDB concessionary loan will pay a lower interest rate of 1.75 per cent.

For a homebuyer refinancing from the HDB in April, based on a loan of $400,000 and 25-year tenor, the potential savings over six months amount to $1,684.
And should interest rates rise over the next eight years, DBS guarantees that it will be capped at the CPF Ordinary Account rate of 2.50 per cent or 0.10 per cent below the HDB concessionary rate….’

The above is posted by Thoughts of a Cynical Investor in his blog. What is obnoxious is that bank housing loan rates have been below the rates charged by HDB for years and why is HDB is charging 2.6%? Making money from daft citizens is so easy as long as they don’t complain.


Anonymous said...

us see wat hapBen when those payments for these loans past due date ...

will they be written off as NPL or the borrowers be seeking helps to meet their obligations

another measure of swiss standard of living?

knnccb .... when will i be evicted??

Ⓜatilah $ingapura⚠️ said...

Great. It is called "competition in the marketplace"-- aka "choice".

>> Making money from daft citizens is so easy as long as they don’t complain. <

No lah. You finances are your business. If you are so goondoo to have "blind faith" then you end up paying for your lack of due diligence.

Anonymous said...

The original returning the CPF to the person at 55 which promised is a good idea. Worried about old people mismanaged their funds is not unfound? But how about those persons who can managed their money well, should there be a mechanism allow them to withdraw their money at 55 as promised, any ideas?

Why keep the money of those who can manage their money better? Why not let those persons who are able to manage their money get a better returns from their funds?

Anonymous said...

Correct me if I am wrong.
In a HDB loan, the CPF stands in front of HDB in the claims on the HDB loan defaulter.
In a bank loan, the bank stands in front of CPF in the claims on the HDB loan defaulter.

If we default on loans from HDB;
our HDB flats will be sold;
and money will first be returned to CPF;
Any left over money is then repaid to HDB.

If we default on loans from commercial banks,
our HDB flats will be sold;
and money will first be used to pay off the banks
Any left over money is then returned to CPF.

Veritas said...

I have blog the the spread between Sibor and prime rate in SG is horribly wide. It is a ripped off for citizen and profit big banks.

But it is bewildering that DBS cap the mortgage rate below CPF rate. Does DBS has insider info that PAP will not let Sibor rise above CPF rate?

Else DBS is taking a huge and foolish risk?

In fact any bank who offer customer Sibor rate should make customer share the risk of Sibor fluctuation.

Anonymous said...

Volunteer pay cut to nordic countries level to return cpf 55?

b said...

I cannot think of any other reason why politicians exist except to screw their own people.

Anonymous said...

Can pay themselves many times of Nordic countries ministers pay, with $300 billions reserves, last time can pay people hard earn money CPF at 55, now can't?

Anonymous said...

Obviously importing people is not a very good idea?

With many older workers and PMET underwork losing the jobs , taking jobs like property brokers, insurance agents, gardeners, cab drivers, security officers and cleaners, losing jobs to newer and newer citizens or foreigners?

You go to find Nordic after 50 years of developing their standard of living reach highest, low gini coeffiency & high birth rate, many olympic champions, Nobel prize winners & many highly successful multi-national companies?

Which they less depend on foreign investments and foreign workers?

In stark contrast, Singapore with the highest ministers pay, ten times of the Nordic produce one of the highest gini coeffiency, lowest birthrate, many of the PMET move out of Singapore and underwork?

Many of the middle income and lower income the standard of living had been dropping, with more population increase and inflation?

As more population increase to vote for the main party, will the situation go worse and worse?

With more frequent flooding, possibly due to more things build, the tighten of the ground, serious riots, severe shortage of hospital facilities, regular and more MRT breakdowns among other things etc?

The first generation of leaders run their country well, they don't over pay themselves so much? Later when they overpay themselves so much situations changed?

Should they consider volunteering reduce their pay to that level of the Swiss, New Zealand or the Nordic ministers salaries? Which need the highest indirect taxes to maintain?

Imagine continue to increase the population of new citizens every year 30K to vote for them, what will happen when the population from now 5.3 to 6.9 millions?

Anonymous said...

It is possible in 2016 new govt forming for the following reasons:

United Nations not approving the using of GRC systme?

Better and better quality opposition candidates?

And opposition parties more united?

Not allow the use of profit sharing schemes during the election as in 2011 which $1k is given during election?

Many of the Main party MP are retiring or taking their profit? Charles of Joo Chiat not many first rate individual want to join the party,likely the popularity continue to slide due to the flawed policies?

The got not much choice but field the 2nd or 3rd rate candidates?

The main party votes had been dropping since (2000-70 percent - 2006 -66 their high percent of winning is due to GRC system not due to one to one contest?) 2011 only 60 percents to recently by election 2013 of 43 2011 they got 55 percent? (Out of 4 parties - Main party 43, WP 53 SDD 1 RP 1)?

2000 internet was not much then, used many only get their info from state controlled media?

From 2011 to 2016 many of the old died hard supporters of the main party died?

Many new youth internet savvy is voting after 5 years?

2011 to 2013 more and more using hand held device for their info?

2016 hand held device likely to saturated the market like the mobile phone saturated the market?

Previously the population only get the info from state controlled medias?

With more people aware their are probably paying the highest taxes in the world?

They don't pay so much direct taxes, but much higher indirect taxes, overall their taxes is still the highest in the world?

A figure head president got a staggering $40 millions in his 12 year tenure, astounding comparing to the most powerful man in the world USA president to get only $5 millions in the same period?

Importing of 30K of new citizens, which likely take away the new citizens, locals and their children jobs or depressed their pay?

The continue increasing inflation?

Unless they lower their salaries competitive to Denmark and New Zealand ministers level, Denmark 5.6M and New Zealand 4.5M people, which is much too high?

They paid themselves an astounding ten time their counterpart in the world? So that less taxes and less foreigners need to pay their highest salaries in the world?

We could see a major shioft after the election 2016, maybe a new govt is form, with a coalitions of numerous parties?

With the change of govt, the quality of life likely to improve due to higher birthrate, people less worry their jobs taken by foreigners or depress by cheaper foreigners, income gap keep closing?

Singapore is moving toward the international standard of advanced economy having a competitive multi parties system?