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|Scenario 1: Refinancing of HDB Loan to Bank Loan
Mr Chong owns a HDB flat at Woodlands. His flat is currently financed by HDB Board paying an interest of 2.6% on his mortgage with an outstanding loan of about $280,000.
Bank A have recently launched a new promotional HDB home loan refinancing package at only 3 months Sibor + 0.9% with an additional flat cash rebate of $1800 to help customer offset the legal cost in transferring the mortgage.
The total effective interest rate of 3months Sibor + 0.9% is equivalent to ~1.30% based on current interbank Sibor rates. The one time flat cash rebate offered by the bank helps Mr Chong to offset his legal cost with only remaining minimal cost to bear (eg. Valuation report cost).
The new interest rates are about 50% less than what Mr Chong is currently paying on his mortgage of 2.6% with HDB.
For more info on refinancing your hdb loan, visit: http://www.mortgagesupermart.com.sg/resources/articles/196-how-refinancing-your-hdb-loan-can-help-you-save-thousands-of-dollars