Need advice on choosing SOR or Sibor package

[evergreen]

Uncompleted.

First, I consider the risks:
1. From 2013, Sibor rates might increase significantly when the Fed's commitment to keep interest rates low expires. http://economicsnewspaper.com/world-...013-55148.html

2. From 2015, the bank reserve requirement will increase. This may cause banks to increase the spread %.
http://www.mas.gov.sg/news_room/pres...ted_Banks.html


Based on the risks, I will choose package 1 - which I think is UOB's package.

- No legal fees if you use their tie-up law firm. This saves you at least 1K upfront. Unless you have a trusted lawyer that you want to use, this is a good deal. (In loan documents, the banks will always state that you have to pay all the legal fees and you have no idea how much it will cost you.)

- No pre-payment/redemption charge. Should interest rates increase significantly, you can pay down the loan with no penalty charges.

- Lowest rate among all for yr 4 onwards (small difference in rates from yr 1 to yr 2 result in small difference in interest amount in dollar because it's uncompleted property). You'll see the full effect of any interest rate difference in yr 3 and yr 4. If you choose package 2 with lock-in, and you want to re-finance in yr 4 (approx 2015), all the banks might have increased their spread to more than 1% so you might have no choice but stick with 1% spread. But of course if they reduce it, you can re-finance. With package 1, it's 0.625% from yr 4. You only pay 0.025% on the amount drawn for some certainty in 2015.

[sh]

I disagree. At 1% p.a. interest, I borrow the max amount and max term.
It's not the absolute number of dollars paid that matters; It's the effective amount after accounting for opportunity cost and inflation. Money today is worth more than money tomorrow (except if there's deflation).

I'll do that too. When else do you get 1% interest rates?

Max the loan out. Keep the extra cash handy for other investments. Can always make lump sum pre-payments if you want to when rates go up.

[DC33_2008]

Do check on the charge of the undisbursed amount of the loan amount as yours is BUC loan. It is about one year after TOP.

[newbie11]

Any suggestions between the two packages?

whats your quantum and which project? perhaps I can source for alternative rates. you can email me at [email protected]

[fisho]

Do check on the charge of the undisbursed amount of the loan amount as yours is BUC loan. It is about one year after TOP.

Are you referring to the undispursed amount after cancellation?

· Cancellation Fees: 0.75% - this applies to undisbursed loan amt only

Care to explain? Thks.

[DC33_2008]

This is correct.

Are you referring to the undispursed amount after cancellation?

· Cancellation Fees: 0.75% - this applies to undisbursed loan amt only

Care to explain? Thks.

[DC33_2008]

Will SOR surpass SIBOR?

Date: 28 Oct 2011

No Key Closing Levels LastPrevious1SGD 3 month SIBOR Fixing0.38%0.38%2SGD 3 month SOR Fixing0.36%0.35%

[samuelk]

With so many Bank offering loans, which one is the most competitive.?

I know that UOB if tie up with a UOL devlopment will be unbeatable rates.

Does anyone know how is standchart like as they seems reasonable at SIBOR + 0.5 and comes with the std freebies. I think we are paying for it but its still nice to consider it as a freebie.

[DC33_2008]

This is for BUC.

With so many Bank offering loans, which one is the most competitive.?

I know that UOB if tie up with a UOL devlopment will be unbeatable rates.

Does anyone know how is standchart like as they seems reasonable at SIBOR + 0.5 and comes with the std freebies. I think we are paying for it but its still nice to consider it as a freebie.

[mygeemeel]

With so many Bank offering loans, which one is the most competitive.?

I know that UOB if tie up with a UOL devlopment will be unbeatable rates.

Does anyone know how is standchart like as they seems reasonable at SIBOR + 0.5 and comes with the std freebies. I think we are paying for it but its still nice to consider it as a freebie.

Mine is BUC, 1 month Sibor+0.5% (1st year), 1 month Sibor+0.5% (2nd year) and 1 month Sibor+0.6% (3rd year). 5 years fire insurance. Legal subsidy is SG$3,500. I didnt buy my unit during launch so there was no special tie up with any banks.

[DC33_2008]

4 nov:

No Key Closing Levels LastPrevious1SGD 3 month SIBOR Fixing0.38%0.38%2SGD 3 month SOR Fixing0.40%0.40%