Fixed vs Floating Rate Mortgages: Choose Wisely via Homejourney
Choose a fixed rate mortgage for payment certainty if you prioritize stability, or a floating rate loan to potentially save on interest if you're comfortable with fluctuations tied to SORA. Homejourney simplifies this decision with side-by-side mortgage rate comparison from DBS, OCBC, UOB and more, plus instant applications via Singpass for trusted, secure financing.
This cluster article dives into fixed vs floating rate options for Singapore buyers, building on our pillar guide Fixed vs Floating Rate Mortgages: Singapore Guide | Homejourney ">Fixed vs Floating Rate Mortgages: Singapore Guide. Discover actionable steps to pick the right interest rate type while leveraging Homejourney's safety-focused tools.
Understanding Fixed Rate Mortgages in Singapore
A fixed rate mortgage locks your interest rate for 1-5 years, shielding you from hikes. Banks like DBS and OCBC offer packages where rates stay unchanged during the lock-in, ideal for budgeting on HDB flats or condos.[1][2] After the period, it converts to floating, often SORA-pegged.
In 2026, fixed rates are competitive at 3-year lows, roughly matching floating options but providing peace of mind. For a S$500,000 loan, switching to a 5-year fixed could save S$4,100 annually versus higher floating rates, per OCBC data.[2] Homejourney's bank-rates page tracks these live.
Floating Rate Loans: SORA and Market Dynamics
Floating rate loans adjust with benchmarks like 3M or 6M SORA (Singapore Overnight Rate Average), replacing discontinued SIBOR/SOR per MAS rules.[3] SORA reflects actual interbank transactions, offering transparency—unlike opaque board rates set by banks.[1]
3M SORA fell to 1.2% by late 2025, its lowest since 2022, making floating attractive for savings.[2] However, volatility means payments can rise if rates climb, following US Fed trends. Track live 3M/6M SORA on Homejourney for timing your application.
The chart below shows recent interest rate trends in Singapore, highlighting SORA movements over the past 6 months:
As seen, SORA's decline favors floating rates now, but fixed protects against reversals.[1][2]
Fixed vs Floating Rate: Pros, Cons and Comparison
Fixed suits risk-averse buyers like first-timers; floating fits those eyeing lower long-term costs. Four in five OCBC customers chose fixed in 2025 for repayment stability.[2]
| Aspect | Fixed Rate Mortgage | Floating Rate Loan |
|---|---|---|
| Rate Stability | Fixed for 1-5 years[1] | Fluctuates with SORA[1][3] |
| Cost | Slightly higher initially[1] | Cheaper, potential savings[1][2] |
| Risk | Miss savings if rates fall | Higher payments if rates rise |
| Best For | Budget certainty[2] | Rate optimizers[1] |
Current packages: Fixed ~2-3% for 2-3 years (DBS/OCBC); Floating 3M SORA + 0.5-1% spread (UOB/HSBC).[1][5] Use Homejourney's mortgage calculator for personalized simulations.
Who Should Choose Which Interest Rate Type?
Risk-averse or first-time HDB buyers: Opt fixed for predictable payments amid TDSR limits. E.g., upgrading from Punggol BTO to a Sengkang resale—lock rates to avoid surprises.[2]
Investors or refinancers: Floating if expecting SORA drops (projected 2.6% by 2025 end).[1] High-income earners buffer volatility.
Assess via this framework:
- Calculate affordability on Homejourney bank-rates.
- Review SORA trends (live on site).
- Test scenarios: +1% rate hike tolerance?
- Apply multi-bank via Singpass for best offers.
Benefits of Applying via Homejourney
Homejourney prioritizes your safety with verified bank partners (DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, RHB, more). Submit one Singpass application—get personalized rates from all, instantly verified for income/employment.[Homejourney]
- Compare transparently: Side-by-side from 11+ banks, no bias.
- Real-time SORA tracking: 3M/6M updates daily.
- Instant calculator: See monthly payments for your S$800k condo loan.
- Secure process: MyInfo auto-fills, brokers guide ethically.
- Refinance easily: Step-by-step, penalty-aware.
Unlike scattered searches, Homejourney verifies data for confident decisions. Link to properties in budget via property search; maintain with Aircon Services ">aircon services.
Actionable Steps: Fixed vs Floating Decision Framework
1. Visit Homejourney bank-rates; input loan amount (e.g., S$600k HDB).
2. Compare fixed (e.g., OCBC 2.5% 3yr) vs floating (UOB 3M SORA +0.7%).
3. Simulate: Fixed ~S$2,800/month; floating ~S$2,600 (at 1.2% SORA).
4. Apply via Singpass—receive offers in days.
5. Consult Homejourney brokers for free. Disclaimer: Rates change; not financial advice. Verify with banks.
FAQ: Fixed Rate vs Floating Rate Mortgage
What is the difference between fixed and floating rate mortgages in Singapore?
Fixed locks rates 1-5 years for stability; floating ties to SORA, cheaper but variable.[1][3]
Is floating rate better than fixed in 2026?
Floating may save if SORA stays low (1.2% now), but fixed rules for certainty—80% choose it.[2]
How does SORA affect my floating loan payments?
3M SORA + bank spread (0.5-1%); e.g., 1.2% +0.8%=2%, ~S$2,500/month on S$600k.[1]
Which banks offer the best fixed rates?
DBS, OCBC lead; compare all on Homejourney—no lock-in surprises.
Why apply via Homejourney?
One secure app, multi-bank offers, live rates—safe, transparent path to approval.
Ready to choose? Start your fixed vs floating rate mortgage journey on Homejourney bank-rates. For full coverage, see our pillar: Fixed vs Floating Rate Mortgages: Singapore Guide | Homejourney ">Fixed vs Floating Rate Mortgages: Singapore Guide.
