10 Ways to Save Money on Your Mortgage: How to Improve Approval Chances
Saving money on your mortgage while boosting approval chances is achievable through smart strategies tailored to Singapore's market. Homejourney, your trusted platform for safe property transactions, outlines 10 ways to save money on your mortgage, reduce mortgage costs, and secure better home loan terms from banks like DBS, OCBC, and UOB.
This cluster article builds on our pillar guide, 10 Ways to Save Money on Your Mortgage Singapore | Homejourney, offering tactical steps for first-time buyers, HDB upgraders, and refinancers. With rates at 3-year lows around 1.35%-1.8% p.a., timing is perfect to act[2][3]. Use Homejourney's bank rates page to compare offers safely.
Why Mortgage Savings Matter in Singapore's 2026 Market
Singapore's Total Debt Servicing Ratio (TDSR) caps borrowing at 55% of income, making approval competitive. Lowering your debt-to-income ratio directly improves chances and unlocks better rates. For a S$500,000 loan, switching from 3% to 1.6% saves ~S$500 monthly[2]. Homejourney verifies all data for your confidence, prioritizing user safety.
Floating rates tied to SORA (now ~1.12% + spread) offer flexibility, while fixed rates provide stability[3][6]. Start with our mortgage calculator to assess eligibility instantly via Singpass.
1. Check and Improve Your Credit Score
A strong credit score (above 700 from Credit Bureau Singapore) signals reliability to banks like HSBC and Standard Chartered. Pay bills on time, reduce credit card balances below 30% utilization. This can lower rates by 0.2-0.5% p.a., saving thousands over 25 years.
Action step: Get your free Credit Bureau report annually. Homejourney tip: Clear small debts first to boost score before applying via our multi-bank system.
2. Reduce Existing Debts Before Applying
Minimize car loans, personal loans, and credit card debt to stay under TDSR limits. For example, paying off a S$20,000 car loan could increase borrowing power by S$100,000+. Banks assess total obligations rigorously per MAS rules.
Pro tip: Use Homejourney's eligibility calculator to simulate debt reduction impacts. Submit one application to DBS, OCBC, UOB, and more for side-by-side offers.
3. Maximize CPF Usage Strategically
Deploy CPF Ordinary Account (OA) funds at 2.5% interest to reduce principal, but plan refunds for arbitrage. With rates falling, refunding CPF after prepayment earns 2.5% vs. low savings rates, capturing ~1% gain[1]. HDB loans at 2.6% may beat banks for some[3].
Homejourney integrates CPF data via Singpass for seamless calculations. See our guide on Partial Prepayment vs Lump Sum: Which Saves More via Homejourney ">Partial Prepayment vs Lump Sum.
4. Shop and Compare Rates Across Banks
Don't settle for the first offer—rates vary: DBS at 1.6% fixed, OCBC with flexible prepayments[2][3]. Homejourney's bank-rates compares DBS, UOB, HSBC, Maybank, CIMB, and 7+ partners instantly.
One application reaches all, saving time and improving negotiation power. Track SORA trends for timing.
Understanding SORA and Rate Trends
SORA (Singapore Overnight Rate Average) benchmarks most floating loans, now at lows driving packages from 1.12%[6]. Fixed rates start at 1.35%-1.8%[3]. The chart below shows recent interest rate trends in Singapore:
As shown, rates eased sharply in 2025, benefiting switchers[2]. Use this to time repricing via Homejourney.
5. Opt for Shorter Loan Tenure
Choose 20-25 years over 30 to cut interest costs by 20-30%. A S$800,000 loan at 1.8% costs S$250,000 less interest over 25 years vs. 30. Banks like RHB and Public Bank offer competitive shorter tenures.
Calculate affordability on Homejourney's calculator.
6. Make Partial Prepayments Early
Penalty-free partial repayments (up to 20-40% in lock-in per bank) reduce principal fast. For S$500k loan, S$50k prepay saves ~S$4,100 yearly[2]. Compare strategies in Partial Prepayment vs Lump Sum: Which Saves More on Singapore Mortgages? | Homej... ">Partial Prepayment Guide.
7. Choose Fixed vs. Floating Wisely
Fixed for stability (1.4-1.8%), floating for potential savings if SORA stays low[3]. Risk-averse? Fixed. Aggressive? Floating with offset accounts[1]. Homejourney brokers guide choices.
8. Time Your Repricing or Refinance
Reprice post-lock-in (1-3 years) or refinance if savings exceed fees (S$2k-5k). OCBC saw 7x repricing surge in 2025[2]. Break fixed inertia if penalties < savings[1].
Use Homejourney bank-rates for fee calculators.
9. Leverage Offset Accounts
Park cash in offset accounts (e.g., offshore options) to reduce interest-bearing principal. S$100k offsets S$70k on S$500k loan, yielding risk-free mortgage rate return[1]. Check with partners like HSBC.
10. Use Homejourney's Multi-Bank Application
Skip branch visits—apply once via Singpass on Homejourney. Auto-fills income/CPF, sends to 10+ banks, tracks offers. Boosts approval by showing demand, often yielding better rates. Connect with our mortgage brokers for personalized advice.
Find properties in budget via property search.
Documentation Checklist for Approval
- NRIC/Passport
- Latest payslips (3 months)
- CPF statements (6 months)
- Income tax assessments (2 years)
- Property Option to Purchase
- Bank statements (3-6 months)
Prepare digitally for Singpass upload on Homejourney—speeds approval by weeks.
FAQ
How much can I save by refinancing now?
S$500k loan from 3% to 1.6% saves S$500/month[2]. Use our calculator.
What's the best way to improve mortgage approval?
Lower debts, boost credit score, maximize CPF. Homejourney's tools verify eligibility first.
Fixed or floating in 2026?
Floating if rates fall further; fixed for certainty[3]. Compare on bank-rates.
Can I prepay HDB loans?
Yes, up to S$8k/year without notice. Banks offer more flexibility.
Is Homejourney safe for applications?
Yes, Singpass-secured, multi-bank verified. User safety first.
Disclaimer: This is general advice. Consult professionals for personalized guidance. Rates as of Jan 2026; subject to change[2][3].
Ready to save money mortgage and lower home loan payment? Start with Homejourney bank-rates today. Link back to pillar: 10 Ways Singapore Guide.
