Sibor rate is dropping!

[zeamybro]

Thanks Sabian and Proud-owner

Really get to learn a lot from your sharings

[yowetan]

SCB finally got back to us. The rate will be 1.58% fixed for 2 years with 2 years lock in period, and thereafter will be 1.0% spread + 1 mth sibor rate.
I am given 14 days to get back to them.

Please kindly advise if I should take it?

[rook]

SCB finally got back to us. The rate will be 1.58% fixed for 2 years with 2 years lock in period, and thereafter will be 1.0% spread + 1 mth sibor rate.
I am given 14 days to get back to them.

Please kindly advise if I should take it?

Go grab it.....before SCB changes its mind!

[yowetan]

Go grab it.....before SCB changes its mind!

Thanks for the affirmation. Do you think sibor will drop, maintain or increase in this 2 years?

[Arcachon]

Decrease.

[rook]

Thanks for the affirmation. Do you think sibor will drop, maintain or increase in this 2 years?

I don't think anyone knows where int rates will be next week, next month, next year....

As a property investor, one has already taken a calculated risk on building mid to long term value on a property investment, so if I have a choice to eliminate the risk of unexpected rises in cash outflows over a duration (via a reasonable fixed rate), I would certainly take that option over any other. In your case, based on all available fixed rate loans in the marketplace today, you have been offered a far superior rate. Your floating premium thereafter at 1%+ 1 mth sibor is also one of the lowest in the market today...so you should take it without blinking.

As to the real question as to whether interest rates will rise in the near to middle term, the USA FED chairperson seems to posturing a desire to want to do so......even though the precise timing or speed in which it will increase seems uncertain. The introduction of Singapore savings bonds in the local context will also raise the cost of funds for Singapore's banks, thus lifting mortgage rates above the 2% level sooner rather than later. The seven 'core banks' in Singapore were also imposed with higher capital req'ts in order to comply with the new Basel guidelines, thus banks also will continue to compete for higher deposits with higher teaser fixed deposit rates. All these means the odds of a rate increase are far greater than one of a static or decreasing one....

For me, a peaceful night of sleep is far more important than worrying if some remote action triggered in the distant financial markets is going raise my mortgage payments....so given a choice, I will always gravitate towards fixed rate mortgages....

[sabian]

Thanks for the affirmation. Do you think sibor will drop, maintain or increase in this 2 years?

Rates will still go up but in a very lembeh manner until we see 4-8 consecutive quarters of significant job growth (not referring to part time jobs) in the US.

No Fed Chair will want to be remembered in history as the one who caused the economy to stall by withdrawing liquidity earlier than required.
EU and Japan are just getting the hang of their own QE cheat code.

But the Fed is caught between a rock and a hard place because there are vultures out there using low rates to borrow for their speculative activities causing prices of almost every asset class to go up (eg: bonds at this moment). So all the Fed can do now is to use their speeches to hint at rate rises and if they actually raise rates when data is not pointing to a strong recovery, the scope of the rate hike will be more symbolic than anything else.

Fed's intention for low rates actually is to help businesses to lower borrowing cost hoping they would be able to invest and expand leading to job creation.

So there.

[sabian]

Thanks Sabian and Proud-owner

Really get to learn a lot from your sharings

You're welcome.

I think your purchase of WB is very astute. I think the exterior facade and unblocked views are good and of course, its location is very good too.

Ditto for DR next door to you.

[proud owner]

SCB finally got back to us. The rate will be 1.58% fixed for 2 years with 2 years lock in period, and thereafter will be 1.0% spread + 1 mth sibor rate.
I am given 14 days to get back to them.

Please kindly advise if I should take it?

what is the Floating rate package like ?

1mth sibor + ??

[newbie11]

1% spread? Show us the LO

[proud owner]

yowetan ....

SCB package to you

2 yr fixed at 1.58 Pct for 2 years ...


in 2008 Lehman crisis ... 1mth ( and 3mth ) sibor was like 1.88 pct ish

since then till jan 2015 ...1mth has been like 0.4 pct ish ... until recently ... then it went to high of 0.88 pct and 3mth high of 1.02 pct


rates will go up ... but it probably wont hit the Lehman crisis levels of 1.88 pct ...

so to me, the 2 yr fixed of 1.58 pct is HIGH ...


assuming sibor stays at current level for the next 2 years ... your loan will revert to 1 % + 1mth sibor ...which will be 1 + 0.76 (latest) = 1.76 pct which is very close to crisis high ..

to me you should check out the FLoating rate package .. assuming floating is 0.5 + sibor, you are better off ... for the immediate 2 years..



all these banks have economists/strategies/ etc ... they know...even with rising I/R, it wont go to lehman level ...

so 1.58 pct for the next 2 years is a Bao Jia rate ...

[yowetan]

yowetan ....

SCB package to you

2 yr fixed at 1.58 Pct for 2 years ...


in 2008 Lehman crisis ... 1mth ( and 3mth ) sibor was like 1.88 pct ish

since then till jan 2015 ...1mth has been like 0.4 pct ish ... until recently ... then it went to high of 0.88 pct and 3mth high of 1.02 pct


rates will go up ... but it probably wont hit the Lehman crisis levels of 1.88 pct ...

so to me, the 2 yr fixed of 1.58 pct is HIGH ...


assuming sibor stays at current level for the next 2 years ... your loan will revert to 1 % + 1mth sibor ...which will be 1 + 0.76 (latest) = 1.76 pct which is very close to crisis high ..

to me you should check out the FLoating rate package .. assuming floating is 0.5 + sibor, you are better off ... for the immediate 2 years..



all these banks have economists/strategies/ etc ... they know...even with rising I/R, it wont go to lehman level ...

so 1.58 pct for the next 2 years is a Bao Jia rate ...

Where can I get floating rate of 0.5 + sibor rate? I think all raise their bases to at least 1-1.5% base?

[MortgageGuru]

SCB finally got back to us. The rate will be 1.58% fixed for 2 years with 2 years lock in period, and thereafter will be 1.0% spread + 1 mth sibor rate.
I am given 14 days to get back to them.

Please kindly advise if I should take it?

If you ever get 1% spread, I will quit this forum and apologise to all my clients personally who took up 1.48% with spread of 1.25% thereafter.

Don't make people who took up 1.48% fixed 2 years at SCB laugh here please.

[Deccante]

SCB finally got back to us. The rate will be 1.58% fixed for 2 years with 2 years lock in period, and thereafter will be 1.0% spread + 1 mth sibor rate.
I am given 14 days to get back to them.

Please kindly advise if I should take it?

Hi,

can I have the contact for the house loan specialist? wanna check with them...thanks

[wildfaye29]

Where are the rates headed in the short to mid term? 1-5 years?
Fed will increase? Banks will go up?

[minority]

If you ever get 1% spread, I will quit this forum and apologise to all my clients personally who took up 1.48% with spread of 1.25% thereafter.

Don't make people who took up 1.48% fixed 2 years at SCB laugh here please.

Int wont go so low come sept. Fed will move the rates up. Plus Singapore economy is slowing. MAS us going to lower the band on the policy which means lower exchange rate to keep singapore competitive. With exchange rate going down means int rates will move up 2nd half. thats for sure. so dont dream int rate will go down south.

[minority]

Where are the rates headed in the short to mid term? 1-5 years?
Fed will increase? Banks will go up?

1-5yrs! wow u asking a very large band leh.... next 1yr people still can forecast.. 5yrs!!! u need a crystal ball and 2 dices.

[Kelonguni]

I might be wrong but the news mentioned monetary easing likely from October.

To stimulate growth it seems that lowering or maintaining interest rates make more sense?

Thanks for advice.

[pmet]

I might be wrong but the news mentioned monetary easing likely from October.

To stimulate growth it seems that lowering or maintaining interest rates make more sense?

Thanks for advice.

LOL if anyone remembers this thread: http://forums.condosingapore.com/sho...S-may-be-wrong!

What the MAS did in 2011 was just boosting the property market in return for weaker export growth. Now, the export slump is threatening the economy, so they have to do the reverse, with negative effects on the property market.

[minority]

I might be wrong but the news mentioned monetary easing likely from October.

To stimulate growth it seems that lowering or maintaining interest rates make more sense?

Thanks for advice.

Singapore MAS tools are typically base on a basket of exchange rate. They manage exchange rate than interest rates directly. So moving the exchange rate up n down have direct impact to SOR rates. the past years with US rates at all time low SGP rates are also down but we shore up the exchange rates to manage inflation. with US Rates going up and inflation at all time low. the exchange rates will weaken sgd to make sure we are competitive. With exchange rates coming down + Spet Rate hikes . int will move up.

http://www.mas.gov.sg/~/media/MAS/Mo...y%20Policy.pdf

" the choice of the exchange rate as the intermediate target of monetary policy
implies that MAS gives up control over domestic interest rates (and money supply). In the
context of free capital movements, interest rates in Singapore are largely determined by
foreign interest rates and investor expectations of the future movements in the Singapore
dollar. Domestic interest rates have typically been below US interest rates and reflect
market expectations of a trend appreciation of the Singapore dollar over time. "