Fixed Deposit Pegged Home Loan Explained: Bank Rate Comparison Guide
A Fixed Deposit Pegged Home Loan, also known as FHR loan or fixed deposit rate loan, ties your mortgage interest to a bank's fixed deposit (FD) rate plus a fixed spread.
This creates a stable rate loan option compared to volatile benchmarks like SORA. Homejourney helps you compare real-time rates from DBS, OCBC, UOB, and more for safe, transparent decisions.
What is a Fixed Deposit Pegged Home Loan (FHR)?
In Singapore, an FHR loan pegs your home loan rate to the bank's published fixed deposit interest rate for a specific tenure, like 6 months or 9 months, plus the bank's spread.
For example, DBS FHR6 uses their 6-month SGD FD rate (currently around 1.4%) + 1.3% spread = 2.7% total rate[2]. The FD component fluctuates with market conditions under MAS oversight, while the spread remains fixed[1][2].
This differs from FHR vs SORA: SORA follows daily overnight lending rates (3-month compounded SORA at 3.641% as of Feb 2024[4]), making FHR more predictable for risk-averse buyers[1].
As part of our pillar on Types of Home Loans in Singapore: Complete Comparison | Homejourney ">Types of Home Loans in Singapore, this cluster dives into FHR specifics for HDB upgraders and private property investors.
How FHR Loans Work: Rate Calculation Example
The formula is simple: Total Rate = Bank's FD Rate (e.g., FHR6) + Spread.
DBS FHR6: 1.4% FD + 1.25% spread = 2.65%[1][2]. Higher tenures like FHR18 offer higher base rates (e.g., 0.60% historically) for potentially steadier pegs[1].
Banks control spreads for profit, but FD rates are semi-transparent and published daily. Unlike opaque board rates, FHR ties directly to verifiable FD promotions[2].
The chart below shows recent interest rate trends in Singapore:
As seen in the chart, FD rates have remained lower and more stable than SORA peaks, ideal for budgeting monthly repayments[1][4].
FHR vs SORA: Key Differences for Singapore Borrowers
| Feature | FHR (Fixed Deposit Pegged) | SORA |
|---|---|---|
| Peg | Bank's FD rate (e.g., 6M) | Overnight market rate average |
| Stability | Higher (FD changes less frequently) | Volatile (daily fluctuations) |
| Current Rate (2026 est.) | 2.5-3.0% total | 3.0-3.7% total |
| Best For | Stability seekers, HDB buyers | Rate optimists |
FHR suits first-time buyers under TDSR limits, offering predictable CPF OA payouts (2.5% floor[4]).
Disclaimer: Rates change; use Homejourney's real-time tracker at https://www.homejourney.sg/bank-rates for latest figures. Not financial advice—consult professionals.
Singapore Bank Comparison: FHR Rates 2026
Homejourney verifies rates from partner banks daily. Here's a snapshot (as of Jan 2026; check live data):
- DBS FHR6: 1.4% + 1.3% = 2.7%. Popular for 90% of DBS loans in peak years[1]. Lock-in: 2-3 years.
- OCBC FD Pegged: Similar 6M FD ~1.5% + 1.2% spread. Strong for private properties.
- UOB FDR6: 1.45% + 1.25% = 2.7%. Mimics DBS; good refinancing option[2].
- HSBC/Standard Chartered: FD-based at 2.6-2.9%; higher spreads but flexible tenures.
- Maybank/CIMB/RHB: Competitive ~2.65%; best for investors via multi-bank apps.
Compare all instantly on Homejourney bank rates—see spreads, effective rates vs market avg (2.8%). Calculate eligibility at https://www.homejourney.sg/bank-rates#calculator.
Pros & Cons of FD Pegged Mortgages
- Pros: Transparent, stable vs SORA spikes; low during low-rate periods[1][3].
- Cons: FD rates can rise with MAS policy; penalties on early break (1-1.5% of loan)[3]. Banks phase out tranches (e.g., DBS from FHR18 to FHR6[1]).
Best for HDB flats in mature estates like Toa Payoh—pair with Property Search ">Homejourney property search for budget fits.
Actionable Steps: Choosing & Applying for FHR Loan
- Compare Rates: Use Homejourney's tool for DBS/OCBC/UOB side-by-side.
- Check Eligibility: Input income/CPF via Singpass—get TDSR-compliant borrowing power instantly.
- Apply Multi-Bank: One form on Homejourney submits to all partners; banks compete with offers.
- Review Lock-In: Opt 2-year for flexibility; avoid if planning early sale.
- Refinance Smart: Track via our SORA/FD charts; switch if spread >1.5%.
Insider tip: For resale HDB in Bishan (near MRT Exit A, 5-min walk), FHR locks payments at ~$2,500/mth for $800K loan—safer than SORA jumps.
Read more in Fixed Deposit Pegged Home Loans Explained: FHR Guide by Homejourney ">Fixed Deposit Pegged Home Loans Explained: FHR Guide by Homejourney.
FAQ: Fixed Deposit Pegged Home Loans
What is the current DBS FHR6 rate?
Around 2.7% (1.4% FD + 1.3% spread), but verify on Homejourney[2].
Is FHR better than SORA in 2026?
Yes for stability if rates stay high; SORA suits falling markets[1][4].
Can I use CPF for FHR loans?
Yes, OA funds at 2.5%—service via CPF portal[4].
How to switch to FHR?
Refinance penalty-free post-lock-in; use Homejourney multi-bank app.
Are FHR rates guaranteed?
No—FD fluctuates; Homejourney provides live updates for trust.
Ready for your FD pegged mortgage? Start safely on Homejourney bank rates—compare, calculate, apply with Singpass. Link to our pillar: Types of Home Loans in Singapore: Complete Comparison | Homejourney ">Types of Home Loans Singapore for full insights. Your trusted partner for secure property journeys.
