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Types of Home Loans in Singapore 2026
Singapore private property buyers can choose from two broad categories of bank mortgage:
- Fixed Rate: Interest rate is locked for a fixed period (typically 2–3 years). You know exactly what you pay each month. After the lock-in period, the loan reverts to the bank’s prevailing floating rate or you refinance.
- Floating Rate (SORA-pegged): Rate adjusts monthly or quarterly based on the Singapore Overnight Rate Average (SORA). When SORA falls, your rate falls; when SORA rises, your rate rises. Typically 0.5–1% lower than fixed at inception but carries rate risk.
What Is SORA?
SORA (Singapore Overnight Rate Average) is the benchmark interest rate for Singapore dollar lending, replacing the old SIBOR (Singapore Interbank Offered Rate) from 2024 onwards. SORA is published daily by the Monetary Authority of Singapore (MAS) and reflects actual overnight borrowing transactions in Singapore’s interbank market.
Key SORA facts for 2026:
- 1-month compounded SORA: typically 2.5%–3.2% range depending on MAS monetary policy
- 3-month compounded SORA: slightly higher, reflecting term premium
- Banks typically offer SORA + spread (e.g., SORA + 0.8% = effective rate of ~3.3%–4.0%)
- SORA rates have fallen from 2023 peaks as global central banks cut rates entering 2025–2026
Fixed vs Floating: 2026 Rate Comparison
| Package Type | Indicative Rate (2026) | Lock-In | Best For |
|---|---|---|---|
| 2-Year Fixed | ~3.0%–3.4% | 2 years | New launch under construction |
| 3-Year Fixed | ~3.2%–3.6% | 3 years | Risk-averse owner-occupiers |
| 1M SORA + 0.75% | ~3.3%–4.0% (variable) | Nil–1 year | Rate-fall beneficiaries |
| 3M SORA + 0.8% | ~3.4%–4.1% (variable) | Nil–1 year | Flexibility seekers |
All rates are indicative only. Actual rates depend on individual credit assessment, LTV, loan tenure, and bank-specific pricing at time of application.
Bank Loan vs HDB Loan: Private Property Context
For private condominium purchases, only bank loans apply — HDB loans are restricted to HDB flat purchases. Key bank loan rules for private condos:
- Maximum LTV: 75% (first property, no existing loans)
- Maximum loan tenure: 30 years (or to age 65 if shorter)
- Minimum loan amount: $100,000 (varies by bank)
- TDSR must be ≤55% of gross monthly income
How to Get the Best Home Loan Rate in Singapore 2026
- Apply to 3–4 banks simultaneously: Rates vary by up to 0.5% between banks — always compare. Use a mortgage broker if you want all comparisons in one view
- Maintain a clean credit score: FICO/CBS credit score affects both rate and approval probability. Check your CBS credit report before applying
- Consolidate debts before applying: Reducing outstanding loans improves TDSR and may unlock better loan-to-income ratios
- Lock in early for new launches: Banks offer In-Principle Approval (IPA) — secure your IPA before booking an OTP to confirm your loan quantum and rate
- Review at lock-in expiry: Refinance or reprice at 2–3 year lock-in expiry — loyalty to your bank after lock-in expires is expensive
Refinancing vs Repricing: What Happens After Lock-In
When your fixed-rate lock-in period ends:
- Repricing: Switch to a new package within the same bank. No legal fees, typically $500–$800 admin fee. Faster but rates may not be best in market
- Refinancing: Move your loan to a different bank. Requires full application, valuation, and legal fees ($2,000–$3,000). More admin but access to the best market rate available
For loans above $500,000, the rate difference from refinancing typically justifies the legal fees within 12–18 months.
Get personalised advice from a licensed property consultant. Free, no-obligation consultation.
Related Guides
- TDSR Singapore 2026 Guide
- Condo Downpayment Calculator 2026
- LTV Limit & Property Loan Guide
- First-Time Buyer Guide Singapore 2026
