Expatriates may discover staying in a hotel room for the entire duration of their stay in Singapore to be a very expensive quandary. An answer to this expensive predicament is purchasing a residential property in Singapore.

In Singapore, foreigners are not prevented by government authorities from buying their own residential properties.

Essentially, the Residential Property Act of Singapore encourages Singapore citizens to buy residential properties in the city-state at reasonable rates. Also, the act supports foreigners who have made an important contribution to Singapore’s economy to purchase residential properties in the country.

Even without any permits or approval from Singapore government officials, an expatriate may acquire non-restricted residential properties. Non-restricted residential properties are identified as any of the following:

- apartment units within a structure that is not more than 6 floors in height – condominium units in authorized condo development sites stipulated in the Planning Act – a lease agreement on a restricted residential property; the agreement must not exceed 7 years

An approval from Singapore’s Minister of Law is needed by expats who want to own all units in an apartment or condominium in an approved development property.

Likewise, an expatriate without any prior official sanction from Singapore’s Minister of Law cannot buy residential properties that are categorized as restricted.

The Residential Property Act of Singapore identifies these restricted residential properties as follows:

- an empty residential land – town houses, detached or semi-linked houses, or terraced houses standing on residential lots – lands not authorized for condo development under the Planning Act

In applying for an official sanction to be able to purchase a restricted residential property, the foreign national must fill out a form and, together with the required supporting documents, send this to the Singapore Land Authority. The bureau is accountable for evaluating the foreigner’s eligibility to buy a restricted residential property and for granting the official sanction if it finds the expat’s qualifications satisfactory.

Find out more about a premier housing loan advisory firm, providing housing loans with free mortgage broking.

Even though refinancing a housing loan can save you thousands of dollars you will be stunned that not that many people in reality take the time to do it. If you considered the time it requires and figure out the cost saving and compare that to how much you get paid per hour it could be like not going to work for several weeks. Consider the following aspects so that you can see how easy it is to refinance your loan today.

Current Mortgage Interest Rate

It is definitely a positive indication for you to explore refinancing when your current interest rate is higher than available home loan packages on the market. A first step to take is to go back to your current bank or financial institution and ask them to revise your package, otherwise known as repricing. If your lender comes back with an offer, it will usually be better than your current one. You can then compare this offer with offers from other lenders to see whether you should switch or stay put.

Lock-in and Clawback Periods

When you take up a mortgage, there may be a lock-in period where your mortgage lender will charge you a penalisation fee, normally a percentage of your outstanding loan amount, if you were to fully repay your mortgage. Almost all housing loans also come with a clawback period where the lender will claim back “freebies”, such as legal expenses, that they “gave” you when you take up your housing loan (Note: lock-in period is separate from clawback period). It may not be commendable for you to refinance due to such costs.

Loan Quantum

The larger your loan amount, the greater your savings for the same decrease in interest rates. For instance, 1% on a loan of S$100,000 is much less than 1% on a loan of S$500,000. However, fixed cost to refinancing, which represents mainly of legal fees, do not vary much with loan quantum. The difference between your existing and refinancing interest rates, therefore, has to be bigger for a relatively smaller mortgage as fixed cost eats into a more fundamental part of your interest rate savings.

Perceived Interest Rate Movements

Your view on how interest rates is moving can be a factor when considering whether you should refinance. If you are currently on a fixed rate package and believe interest rates are dropping, you may want to refinance to a floating rate package. Conversely, if you are on floating rates and believe interest rates are rocketing, switching to fixed rates may be a solid choice.

Personal Financial Assessment

If there is a change in your financial state, you may want to change your package details via refinancing. For example, you are opening your own business organisation and do not want unpredictability in other areas. Give some consideration to taking up a fixed rate package. Maybe you want cash to invest in different property. Consider increasing your loan quantum. Or your monthly income has increased and you want to reduce interest loan payments. Contemplate reducing your loan tenure.

If looking through this article is giving your a headache or you simply want to save yourself the trouble, contact us for a non-obligatory loan interview. Our professional advisors not only frees up your time but also do not charge any fees to help you get the best deal. Refinancing does not have to be a boring process.

Learn more about a premier Housing Loan advisory firm, providing Housing Loans with free mortgage broking.

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Once you decide to avail a home loan, the immediate matter that storms your brain is choosing between fixed and floating rate of interest. It is easy to get stuck at this stage if you are not financially trained.

If the media and banks are exclaiming about increased interest rates you make feel pressed to go and rush into fixing your home loan rates. Your bank or financial consultant may even propose this.

Now ideally as it should be, we take for granted that once you choose fixed rate plan for yourself the rate of interest will remain unchanged for the entire period you have fixed the interest rate for irrespective of any subsequent increase in the same. But actually this is not necessarily the situation.

Here we demystify the nature of fixed interest rate home loan transaction for you so that you can make an educated decision over the subject.

* Check the small print of a loan. The bank has the right to serve you 30 or 60-days notice that it intends to increase its rates.

* The bank’s first-year rates are binding on the bank only for that short period of 1 or 2 months. The 2nd-year home loan rates are not binding at all. Neither are the bank’s 3rd-year loan rates.

* Force Majeure Clause

So, while you read your home loan agreement papers, you can spot clauses like this:

“Provided further that from time to time, the bank may in its sole discretion alter the rate of interest suitably and prospectively on account of change in the internal policies or if unforeseen or extraordinary changes in the money market conditions take place during the period of the agreement.”

This is called Force Majeure Clause that enables the bank to undertake appropriate adjustments in the interest rates on home loans they approve to their borrowers.

So remember to look at refinancing every couple of years so that you do not pay too much. If you select a good home loan company you can save a lot of money over the life of your mortgage and in almost all cases the consultation cost is free.