Refinancing vs Repricing: Which Saves You More in 2026?

Refinancing vs Repricing: Which Mortgage Strategy Saves You More?

If you're a Singapore homeowner looking to reduce your monthly mortgage payments, you've likely encountered two options: refinancing and repricing. While both allow you to switch to a lower interest rate, they work differently—and choosing the right one could save you thousands of dollars. At Homejourney, we believe transparent financial guidance is essential to building trust with our users, which is why we're breaking down exactly how each option works and which makes sense for your situation.

Refinancing involves switching your home loan to a different bank entirely, while repricing means changing to a different interest rate package within your current bank. The difference might sound small, but it significantly impacts your costs, timeline, and potential savings.

Understanding the Key Differences

What is Repricing?

Repricing allows you to switch to a different interest rate package with your existing bank after your lock-in period ends.[1] This is the faster and simpler option. Your current bank might offer you a choice between fixed-rate packages (typically 1-3 years) or floating-rate packages linked to SORA (Singapore Overnight Rate Average).

The repricing process is straightforward: you contact your bank, review available packages, and switch—usually within 2-4 weeks.[3] There's minimal paperwork involved since your bank already has all your documentation on file.

What is Refinancing?

Refinancing means taking out a completely new loan with a different bank and using it to pay off your existing mortgage.[2] This gives you access to the entire market's offerings rather than being limited to your current bank's packages. You can compare rates from DBS, OCBC, UOB, HSBC, Standard Chartered, and other major lenders—all in one place on Homejourney's bank rates comparison page, where you can see current rates and calculate potential savings instantly.

The refinancing process is more involved: it requires legal documentation, property valuation, and typically takes 6-12 weeks to complete.[3] However, the expanded choice often results in better rates and more favorable loan features.

Cost Comparison: The Real Numbers

This is where the decision becomes concrete. Understanding the actual costs helps you calculate whether the savings justify the effort.

Repricing Costs

Repricing fees are straightforward and typically lower:[2]

Administrative fee: $300–$1,000
No legal fees required
No valuation fees

Most banks charge around $800 for repricing.[3] This is a fixed cost regardless of your property's value or loan amount.

Refinancing Costs

Refinancing involves multiple fees that can add up quickly:[2]

Legal fees: $1,500–$2,000 for HDB properties; $1,800–$2,000 for private properties
Valuation fees: $150–$200 for HDB properties; $150–$700 for private properties
Total typical cost: $1,650–$2,700 for HDB; $1,950–$2,700 for private properties

However, there's important relief available: If your outstanding HDB mortgage exceeds $200,000, banks will typically waive all refinancing fees as part of their promotional packages.[2] This is a game-changer for most HDB owners, making refinancing effectively free in terms of upfront costs.

Many banks also offer cash rebates ($500–$1,500) to offset these costs, further reducing your net expense.[1]

Current Interest Rate Environment (January 2026)

Understanding where rates are now helps you time your decision correctly. As of early 2026, Singapore's mortgage market is experiencing historically low rates:

Three-month SORA rates have dropped to 1.34%—the lowest in three years[1]
Bank loan packages range from 1.55% to 1.8% for fixed rates[1]
HDB's concessionary loan rate remains fixed at 2.6%[1]
Popular packages include two-year fixed rates at 1.48% with free conversion after year one[1]

The chart below shows recent SORA trends to help you understand how rates have moved:

This rate environment is particularly favorable for HDB owners considering refinancing to bank loans. The 1.0%+ savings compared to HDB's 2.6% rate can translate to hundreds of dollars monthly in interest savings.

Calculating Your Break-Even Point

The critical question is: will your interest savings cover the refinancing costs? Here's how to calculate it:

Break-Even Formula:

Months to break even = Total refinancing costs ÷ Monthly interest savings

Example for an HDB owner:

Current loan: $300,000 at HDB's 2.6% rate
Refinancing to: 1.6% fixed rate with $0 fees (fee waiver for >$200k loan)
Monthly interest savings: Approximately $250
Refinancing costs: $0 (waived)
Break-even: Immediate—you start saving from month one

Example for repricing:

Current loan: $300,000 at 2.8% rate
Repricing to: 1.8% with same bank
Monthly interest savings: Approximately $250
Repricing cost: $800
Break-even: 3.2 months—you recover the cost in just over 3 months

In both scenarios, the break-even is quick. However, refinancing offers significantly larger potential savings if you're switching from HDB or from a bank with higher rates.

Speed: When You Need Results Quickly

If you need to lock in a lower rate immediately, repricing wins on timeline:[3]

Repricing: Takes effect within 2-4 weeks; you can start enjoying savings within a month
Refinancing: Takes 6-12 weeks; you wait 2-3 months before savings begin

This timeline difference matters if you're concerned about rates rising. However, in the current environment where rates are at 3-year lows, most experts expect further declines to be modest.[1] The urgency is lower than it would be in a rising rate environment.

Flexibility and Loan Features: The Hidden Advantage

This is where refinancing often provides superior value, though it's frequently overlooked.

When you refinance, you can choose from the entire market's offerings:[2]

Fixed-rate packages for rate certainty
SORA-linked floating rates for potential savings
Hybrid packages combining both
Offset accounts that reduce interest by allowing savings to offset your loan balance
Free conversion options after lock-in periods
Flexible repayment terms

When you reprice, you're limited to whatever your current bank offers.[2] If your bank's package doesn't include features you want—like an offset account or free conversion—you're stuck paying for inferior terms just to stay with one bank.

Modern bank packages increasingly include free repricing or free conversion options after the first year,[1] giving you flexibility to adapt if interest rates change. This feature alone can justify refinancing to a bank that offers it.

The HDB Loan Decision: A One-Way Street

If you're currently on an HDB concessionary loan, understand this critical point: once you refinance to a bank loan, you cannot switch back to an HDB loan in the future.[1][5] This is permanent.

This matters because:

HDB loans are subsidized and offer favorable terms for eligible borrowers
If interest rates spike dramatically in the future, you can't return to HDB's protection
However, current rate differentials (HDB at 2.6% vs. banks at 1.6%) are substantial enough that most financial advisors recommend refinancing for significant savings

The decision should be based on your confidence in the rate environment. In early 2026, with rates at 3-year lows and experts expecting only modest further declines,[1] refinancing from HDB to a bank appears favorable for most owners.

Which Option Is Right for You?

Choose repricing if:

You want the fastest process with minimal paperwork
Your current bank's package meets all your needs
You're comfortable paying slightly higher interest to avoid the refinancing process
You have limited time for research or comparison
You're repricing within the same bank and the savings are still meaningful (at least $100+ monthly)

Choose refinancing if:

You're switching from HDB to a bank (current rate gap is substantial)
Your current bank's rates are significantly higher than market rates
You want access to specific loan features your bank doesn't offer
You have an outstanding loan >$200,000 (fee waivers apply)
You want maximum interest savings and are willing to wait 6-12 weeks
You want flexibility to switch banks again in the future if rates change

Making Your Decision: A Step-by-Step Approach

Step 1: Check your lock-in period
Review your mortgage document to confirm when your lock-in period ends. You cannot reprice or refinance until this period expires, and switching early typically incurs penalties.

Step 2: Calculate your potential savings
Use Homejourney's mortgage calculator to compare your current rate against available market rates. Input your loan amount, remaining tenure, and current rate to see instant savings projections.

Step 3: Compare all options
Visit Homejourney's bank rates page to see current offerings from DBS, OCBC, UOB, HSBC, Standard Chartered, and other major lenders. You'll see rates, fees, cash rebates, and special features side-by-side—giving you complete transparency.

Step 4: Factor in all costs
For refinancing, confirm fee waivers (especially important for HDB loans >$200k). For repricing, get the exact repricing fee from your bank. Subtract any cash rebates from the total cost.

Step 5: Calculate break-even timeline
Divide total costs by monthly savings. If break-even is under 12 months, the option is typically worth pursuing.

Step 6: Apply with confidence
If refinancing, submit your application through Homejourney to compare offers from all major banks simultaneously. You can use Singpass for instant data verification, speeding up the approval process. Let banks compete for your business—you'll receive multiple offers from a single application, giving you real negotiating power.

Real-World Example: The Difference in Action

Consider Denise Chan's actual experience: she repriced her DBS mortgage in December 2025, moving from 3% to 1.6% fixed rate.[4] This monthly saving of approximately $500 on a typical $300,000 loan demonstrates why many homeowners are taking action now.

Had she refinanced instead of repriced, she might have accessed:

Potentially even lower rates (some packages at 1.48%)
Free conversion options after year one
Better loan features
The ability to switch banks again if rates drop further

However, repricing gave her the same result faster—she started saving within weeks rather than months.

Market Outlook: What to Expect in 2026

Expert analysis suggests refinancing activity will remain healthy through mid-2026, but may moderate afterward.[1] Here's why this matters for your timing:

Many borrowers who locked in at 3-4% in 2023-2024 have already refinanced at lower rates[1]
The bulk of rate declines have already occurred; further drops are likely to be modest[1]
From mid-2026 onward, refinancing activity may slow as fewer borrowers have compelling reasons to switch[1]
HDB loan refinancing activity is expected to stay steady throughout 2026[1]

This suggests that if you're considering refinancing, early 2026 remains a favorable window. Waiting until mid-year or later may mean missing out on promotional offers and rate advantages.