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Maybank Home Loan Review Singapore 2018 – Which Mortgage to Choose from Maybank

maybank home loan 2018 singapore

Peter Lin

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Maybank home loan packages are the only ones in the market which are all pegged to an internal board rate called the Singapore Residential Financing Rate. Board rates are non-transparent interest rates that the bank can change whenever they want, with no external check and balance. This makes Maybank home loan interest rates worth taking a second look at.

If you’re buying a new property and looking for a Maybank home loan, here are the best packages they offer, whether your property is uncompleted or completed.

 

Maybank Home Loan for an HDB BTO, Building under Construction, with a purchase price of $350,000, loan tenure of 25 years

Home Loan Package Estimated Monthly Instalment Notes
Year 1: 1.62% (variable)
Year 2: 1.65% (variable)
Year 3: 1.68% (variable)
Thereafter: 1.80% (variable)
$1,138 No lock-in

1.5% penalty for partial or full prepayment during first 3 years

Uses the bank’s Internal Board Rate Singapore Residential Financing Rate of 4% to calculate thereafter interest rates

Year 1: Maybank 36FDMR + 0.22%
Year 2: Maybank 36FDMR + 0.25%
Year 3: Maybank 36FDMR + 0.28%
Thereafter: Maybank 36FDMR + 0.59%
$1,138 No lock-in

No penalty for partial or full prepayment

Cancellation fee applies for undisbursed loan

No valuation report needed for under construction property

Free change of interest rates package before TOP or 3 months after TOP

*updated as of 15 March 2018

For a building under construction, such as an HDB BTO flat, Maybank now offers two home loan packages. One is a variable board rate where the interest increases every year, while the other is a newly introduced fixed deposit-linked rate pegged to Maybank’s 36-month fixed deposit interest rate.

The variable board rate not ideal for three reasons.

Firstly, because the loan amount is disbursed in stages for a building under construction, the lower interest rates often do not apply to the bulk of the loan. The longer you wait for your building to be complete, the more interest you end up paying once larger amounts are disbursed.

Secondly, the fact that it is a non-transparent variable board rate should be a concern. This is because there are essentially no checks and balances, with Maybank reserving the right to increase interest rates unilaterally. This is unlike SIBOR, which is transparent and represents an average of several banks’ cost of funds, and fixed deposit-linked home loan rates, which involve some cost to the bank. Maybank can increase a board rate anytime they want, for any amount they want.

As a result, what may originally seem like stability in your home loan repayments may not really be the case anymore. The first and latest time Maybank increased the Singapore Residential Financing Rate, it was 18 February 2016, from 3.75% to 4%. There was no change previously since the SRFR was introduced in 2007. Now that the decade of low interest rates is clearly over, you can probably expect the SRFR to fluctuate more often.

That said, there is no doubt that it is one of the cheaper home loan packages in the market today. If you’re a risk-taker, you may want to give this Maybank home loan package a shot. Just don’t say I didn’t warn you.

Interestingly enough, Maybank has also recently introduced a new fixed deposit-linked home loan package. They are pegged to the 36-month fixed deposit interest rate of 1.40% and currently, this makes the interest rates for both variable board rate package and fixed deposit-linked home loan package exactly the same for the first three years. Thereafter, the interest rates for the fixed deposit-linked home loan package shoot up past the variable board rate package.

While we would normally recommend a fixed deposit-linked home loan package over the variable board rate home loan, we have to note that in this case, you might need to refinance after 3 years, so hope and pray that your property is completed before then since you’ll incur cancellation charges if the loan is not fully disbursed.

For uncompleted private properties: The same Maybank housing loan packages are also offered to uncompleted private properties.

 

Maybank Home Loan for a completed condominium unit, with a purchase price of $1,000,000, loan tenure of 30 years

Home Loan Package Estimated Monthly Instalment Notes
Year 1: 1.62% (variable)
Year 2: 1.65% (variable)
Year 3: 1.68% (variable)
Thereafter: 1.80% (variable)
$2,818 3-year lock-in

1.5% penalty for partial or full prepayment during first 3 years

Uses the bank’s Internal Board Rate Singapore Residential Financing Rate of 4% to calculate thereafter interest rates

Year 1: Maybank 36FDMR + 0.22%
Year 2: Maybank 36FDMR + 0.25%
Year 3: Maybank 36FDMR + 0.28%
Thereafter: Maybank 36FDMR + 0.59%
$2,818 3-year lock-in

1.5% penalty for partial or full prepayment during first 3 years

Year 1:  1.85% (fixed)
Year 2: 1.85% (fixed)
Thereafter: Maybank 36FDMR + 0.59%
$2,915 2-year lock-in

1.5% penalty for partial or full prepayment during first 3 years

Year 1:  1.75% (fixed)
Thereafter: Maybank 36FDMR + 0.59%
$2,919 1-year lock-in

1.5% penalty for partial or full prepayment during first 3 years

*updated as of 15 March 2018

For completed properties, Maybank offers 4 home loan packages – a variable rate home loan package, a fixed deposit-linked home loan package and two fixed rate home loan packages.

We’ve already talked about the concerns about the variable rate home loan earlier. But in spite of our concerns, we have to admit it is one of the cheaper options in the market today. Interestingly enough, you can get the same interest rates from the fixed deposit-linked home loan package (based on the current Maybank 36FDMR of 1.40%). At this stage, it’s too early to say which is less risky, though one would expect the fixed deposit-linked home loan package to be less volatile, since increasing the fixed deposit interest rate represents a cost to the bank. Do note that after 3 years, the interest rate for the fixed deposit-linked home loan package becomes much higher than the variable board rate.

The fixed rate home loan packages are among the lower fixed rate packages in the market today. This definitely makes it a worthwhile consideration if your property purchase price is lower and you have less home loan options to choose from. Unfortunately, the thereafter rate is rather high, which means you may need to consider refinancing after 3 years. Yes, despite the shorter lock-in periods, do note that there is a 1.5% penalty if you refinance before 3 years are up, so beware of that.

For completed HDB flats: The same Maybank housing loan packages are available for resale HDB flat purchases as well.

 

Should you go with a Maybank home loan package?

Perhaps the main thing worth mentioning about Maybank home loan packages is that the board rate it is pegged to has only been revised once in the past 10 years. This may give it an illusion of stability, but the fact is that Maybank reserves the right to change it as often as they wish, especially as we see interest rates rise across the board.

It has to be noted that Maybank has shown a willingness to be a player in Singapore’s already competitive home loan market. Not only do they seem committed to offering one of the lowest rates in the market, they are also introducing their own fixed deposit-linked home loan package, which gives Maybank customers more options.

One additional bonus of taking a Maybank home loan is that you get bonus interest on your Maybank SaveUp account, which allows you to earn up to 3% interest p.a. on the first $60,000. The flexibility of the SaveUp account means you can earn bonus interest when you use up to 9 Maybank products and services, including credit card spend, GIRO bill payment and unit trust investment.

Are you interested in applying for a Maybank home loan? Speak to one of our mortgage specialists to find out which bank is offering the best home loan in Singapore for your particular needs.

Looking for home loans from another bank? Here are the other home loan packages we’ve reviewed.

Best Home Loans Singapore (2018) – Most Affordable Housing Loans Reviewed

DBS Home Loan Reviews Singapore 2018

OCBC Home Loan Reviews Singapore 2018

UOB Home Loan Reviews Singapore 2018

BOC Home Loan Reviews Singapore 2018

Citibank Home Loan Review Singapore 2018

Standard Chartered Home Loan Review Singapore 2018

Keep updated with all the news!

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Peter Lin

I am the poster boy for reinventing one's self. I've been a broadcast journalist, technical writer, banking customer service officer and a Catholic friar. My life experiences have made me the most cynical idealist you'll ever meet, which is why I'm also the co-founder of a local pop culture website. I believe ignorance is not bliss, and that money is the root of all evil only if you allow it to be.