How to Save Money Refinancing Your Mortgage: Homejourney Guide
Executive Summary: This definitive Homejourney guide reveals how Singapore homeowners can save money refinancing amid falling SORA rates at 3-year lows. Learn to reduce mortgage payment by up to S$500 monthly, calculate refinance savings calculator results, and cut mortgage costs with bank comparisons from DBS, OCBC, UOB, and more. With HDB owners switching en masse, now's the time to act safely via Homejourney's trusted platform.
Table of Contents
- 1. Refinancing Fundamentals: Repricing vs Refinancing
- 2. When to Refinance: Timing and Triggers
- 3. Financial Analysis: Calculate Your Savings
- 4. Understanding SORA and Current Rates
- 5. Step-by-Step Refinancing Guide
- 6. Advanced Money-Saving Strategies
- 7. HDB Loans vs Bank Refinancing
- 8. How Homejourney Makes Refinancing Safe and Simple
- FAQ: Common Refinancing Questions
- Next Steps with Homejourney
1. Refinancing Fundamentals: Repricing vs Refinancing
Refinancing means switching your mortgage to a new loan with another bank to secure a lower interest rate or better terms, potentially saving thousands over the loan tenure. Repricing, however, stays with the same bank but changes the interest package after your lock-in period ends. In Singapore's 2026 market, refinancing dominates as HDB flat owners flock to bank loans cheaper than HDB's 2.6% rate[1].
Understand the difference: Repricing avoids legal fees but may incur admin charges (S$200-S$500), while refinancing offers cash rebates up to S$3,500 but includes costs like valuation (S$350-S$500) and legal fees (S$1,800+)[3][4]. Homejourney simplifies this by letting you compare both options instantly.
Key Differences Table
| Aspect | Refinancing | Repricing |
|---|---|---|
| Bank Switch | Yes, to new bank | No, same bank |
| Costs | Legal, valuation, clawback | Admin fees only |
| Savings Potential | Higher (e.g., S$4,100/year on S$500k loan)[2] | Moderate |
| Lock-in Break | Possible penalties | After lock-in free |
Pro Tip: Check Homejourney's bank rates page for real-time comparisons across DBS, OCBC, UOB, HSBC, and more. For deeper dive, see our cluster Refinancing vs Repricing: Which Saves You More Money in 2026? ">Refinancing vs Repricing guide.
2. When to Refinance: Timing and Triggers
The best time to refinance is when SORA rates drop significantly below your current rate, like now with 3-month SORA at 1.34%—a 3-year low[1]. Act if your lock-in ends soon, or rates have fallen 0.5%-1% since origination. HDB owners saved S$3,600 yearly on S$400k loans by switching[1].
Watch for: End of 2-3 year lock-ins (common in 2023-2024 loans at 3-4%), bank promotions with rebates, or personal changes like income boost reducing TDSR stress. Avoid mid-lock-in unless savings exceed penalties (1-1.5% of loan).
Refinancing Triggers Checklist
- Your rate >2% while market offers 1.4-1.8%[1][3]
- Lock-in expires within 3 months
- Bank rebates cover fees (e.g., S$2,000+ for S$500k+ loans)[4]
- Expected hold >3 years (break-even period)
- SORA projected stable at 1.3-1.4% into 2026[1]
Refinancing surged 35-40% in 2019-2020 lows; 2025-2026 mirrors this[1]. Track via Homejourney's real-time SORA tools.
3. Financial Analysis: Calculate Your Savings
To save money refinancing, compute break-even: (Refinancing costs) / (Monthly savings). Example: S$3,000 costs, S$400 monthly savings = 7.5 months break-even. Profitable if staying longer.
Real example: S$500k loan at 3% to 1.6% saves S$4,100/year (S$340/month)[2]. Use Homejourney's refinance savings calculator for personalized math. Factor clawback (3 months interest if early exit) and no HDB revert[1].
Break-Even Calculation Example
| Item | Amount (S$) |
|---|---|
| Legal Fees | 1,800 |
| Valuation | 500 |
| Total Costs | 3,000 (less rebate) |
| Monthly Savings | 400 |
| Break-Even | 7.5 months |
Over 25 years, 1% rate drop on S$500k saves S$100k+. Read our How to Calculate If Refinancing is Worth It | Homejourney ">How to Calculate If Refinancing is Worth It cluster.
4. Understanding SORA and Current Rates
SORA (Singapore Overnight Rate Average) is the key benchmark for floating mortgages, replacing SIBOR. 3M SORA at 1.34% p.a. drives rates to 1.48-1.8%[1][3]. Fixed rates start at 1.40-1.55% for 2-3 years[3][4].
The chart below shows recent interest rate trends in Singapore:
As seen, rates fell from >3% in 2023 to 1.3-1.4% now, fueling refinancing[1]. Projections: Stable into 2026 mid-year[1]. Compare packages on Homejourney bank-rates.
Top 2026 Refinancing Rates (Jan 2026)
5. Step-by-Step Refinancing Guide
Step 1: Assess eligibility (TDSR <60%, MSR <30% for HDB). Use Homejourney calculator.
Step 2: Compare rates on Homejourney – DBS 1.6% 2Y fixed, OCBC up to S$4,100 savings[2].
Step 3: Gather docs: NRIC, income proof, property title, Singpass ready.
- Submit multi-bank app via Homejourney – one form, multiple offers.
- Bank valuations (1-2 weeks).
- Legal completion (4-6 weeks total).
- Funds transfer, new loan starts.
Timeline: 1-2 months. Insider tip: Apply end-month for faster processing.
6. Advanced Money-Saving Strategies
Negotiate: Leverage offers from UOB, HSBC against DBS. Demand higher rebates (S$3,500 for S$600k+)[3]. Opt flexi-loans for offset accounts. Combine with property search on Homejourney property search for upgrades.
Cashback covers costs; free conversions post-year 1 add flexibility[1]. For investors, cash-out refinance for new buys – but watch LTV limits (75% owner-occ, 55% investor).
- Shop 3+ banks via Homejourney multi-submission.
- Time for promotions (e.g., DBS legal subsidy).
- Shorten tenure post-rate drop to cut mortgage costs.
7. HDB Loans vs Bank Refinancing
HDB's 2.6% fixed vs banks' 1.4-1.8% floating – switch saves S$3,600/year on S$400k[1]. Irreversible, so calculate long-term. Banks offer rebates, but HDB has CPF grants. See Hidden Costs of Mortgage Refinancing You Need to Know | Homejourney ">Hidden Costs cluster.
8. How Homejourney Makes Refinancing Safe and Simple
Homejourney prioritizes your safety with verified rates from DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, RHB, and more. Submit one app via Singpass for instant verification – banks compete, you win offers. Track SORA live, calculate savings securely.
Our platform builds trust: Transparent comparisons, no hidden fees, customer feedback-driven. Connect with Homejourney Mortgage Brokers for personalized advice. Start at https://www.homejourney.sg/bank-rates.
FAQ: Common Refinancing Questions
Q: How much can I save refinancing in 2026?
A: Up to S$4,100/year on S$500k loan switching to 1.6%[2]. Use Homejourney's refinance savings calculator.
Q: What's the break-even for refinancing?
A: Costs / monthly savings. E.g., S$3k / S$400 = 7.5 months.
Q: Can I refinance HDB loan?
A: Yes, to banks, but no reverse. Ideal now at 1.34% SORA[1].
Q: Best banks for refinancing?
A: DBS (rebates S$2.8k), OCBC (7x switch growth), UOB[1][2]. Compare on Homejourney.
Q: Refinancing costs Singapore?
A: S$2k-S$5k total, offset by rebates. Details in our Hidden Costs of Mortgage Refinancing You Need to Know | Homejourney ">Hidden Costs guide.
Q: SORA vs fixed for refinancing?
A: SORA for flexibility (1.4%), fixed for certainty (1.5% 2Y)[3].
Disclaimer: This is educational; consult professionals. Rates as of Jan 2026[1][3]. Homejourney verifies data for trust.
Next Steps with Homejourney
To save money refinancing and reduce mortgage payment, visit Homejourney bank-rates now. Calculate, compare, apply safely – one platform for your secure journey. Find budget-fit properties at property search. Trust Homejourney for verified, transparent savings.
