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Borrowers feel rate hike pinch
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Koh Ching Ching, OCBC head of group corporate communications, said: "We have repriced parts of our home loans portfolio with an average increase of 0.30 per cent across loan packages, aligned with repricing in the industry since early this year."
"Loans that have been repriced were generally priced below the funding cost," Ms Koh said.
UOB's fixed rate home loan packages have been popular as customers take advantage of locking in interest rates that have been at historic lows, said a bank spokeswoman.
"The average revised rate will be from 1.75 to 1.95 per cent per annum which is in line with market rates. This means a customer can expect to pay an average of S$20 more per month for every S$200,000 outstanding on their home loan," said the UOB spokeswoman.
For a S$1 million outstanding loan, a 20 and 30 basis points increase will mean S$95 and S$140 increases respectively in monthly instalments, according to DBS' calculations.
Those who have passed their lock-in periods can sign on to a new package, typically priced low to retain existing customers and entice new borrowers.
"If clients' loans have passed the lock-in period, we offer the option of repricing their loans to other mortgage packages," said the StanChart spokeswoman. StanChart will waive the repricing fee for existing clients who wish to reprice their loans after the two-year lock-in period.
New packages are priced low to get the business but could also face interest rate hikes 6-12 months later, said Darren Goh of mortgage broker MortgageWise.sg.