Repricing refers to switching to a new home loan package within the same bank. Refinancing means closing your current home loan account and opening a new one with another bank.
Considering repricing or refinancing your home loan? Here are some factors to consider first:
We recommend you only reprice or refinance when you can save money or choose a loan package that better suits your current needs. Before you decide to reprice or refinance your home loan, here are a few points to consider.
1. Calculate the benefits
Repricing or refinancing allows you to switch to a package with a lower interest rate to save on interest, or to choose a loan package that better suits your needs. For example, if you are concerned about rising interest rates, you can switch to a fixed-rate package. Repricing allows you to enjoy the new loan package within a month, while refinancing typically takes at least three months to take effect. Therefore, with repricing, you can start saving on interest sooner.
2. Be aware of additional costs
Repricing may incur a repricing fee of about S$800. Refinancing requires you to pay legal and valuation fees, which are usually over S$2,000. Sometimes, you may enjoy a lower repricing fee or receive some form of subsidy to cover the legal and valuation fees. When calculating how much you can save, be sure to account for these additional costs.
3. Enjoy a seamless experience
If you choose to reprice, there is no need to engage a law firm and a valuation company. If you choose to refinance, in addition to the legal and valuation fees, you will also need to take time to visit the law firm and wait at home for the valuer. A home loan is a long-term financial commitment and may be your largest monthly expense. The customer care program offered by AnjiaSG can help our clients better manage their home loans. Please feel free to contact us so we can help you calculate the figures and make an informed decision.
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