Refinancing vs Repricing: Which Saves You More Money in 2026?

The choice between refinancing and repricing your mortgage isn't just about picking the lower interest rate—it's about understanding which option truly saves you the most money when you factor in all costs and timelines. At Homejourney, we believe informed homeowners make better financial decisions, which is why we're breaking down this critical decision with complete transparency.

With Singapore's mortgage rates at three-year lows in early 2026, thousands of homeowners are reviewing their loans. Whether you're an HDB owner looking to switch to a bank loan or a private property owner seeking better terms, understanding the difference between refinancing and repricing could save you thousands of dollars.

Understanding the Core Difference

Repricing means switching to a different interest rate package with your current bank after your lock-in period ends. You're essentially renegotiating terms while staying with the same lender. Since the loan stays within the same bank, there's no need for new legal documentation or property valuation—making it simpler administratively.

Refinancing means taking out a completely new loan with a different bank to pay off your existing mortgage. This involves new legal documents, property valuation, and a full application process, but it gives you access to the entire market's offerings.

The distinction matters significantly for HDB owners. If you're currently on an HDB loan at the standard 2.6% rate, repricing isn't an option—HDB only offers one fixed rate pegged to CPF. You can only refinance to a bank loan to access lower rates. This has driven the surge in HDB-to-bank refinancing we've seen since early 2025, with OCBC alone reporting a 60% increase in HDB refinancing applications compared to 2024.

The Real Cost Comparison

Before deciding which route to take, you need to understand the actual costs involved:

Repricing Costs: Approximately $800 in administrative fees. Since you're staying with your current bank, there are no legal fees or valuation charges. The process typically takes about one month.

Refinancing Costs: Usually $2,000 or more, including legal fees, valuation fees, and potential clawback charges (if applicable). However, many banks now offer cash rebates and legal fee subsidies to attract refinancing customers. For example, some banks are offering rebates that can offset a significant portion of these costs. The process typically takes at least three months from application to completion.

The cost difference is substantial, but it's only part of the equation. You need to calculate whether the interest rate savings justify the higher refinancing costs.

Real Savings Examples from Singapore

Let's look at actual scenarios playing out in Singapore's market right now:

HDB Owner Refinancing Example: An HDB owner with a $400,000 loan at 2.6% refinancing to a bank loan at 1.6% (two-year fixed rate) saves approximately $3,600 in the first year alone. Even after accounting for $2,000 in refinancing costs, the net savings in year one is $1,600. By year two, the cumulative savings exceed $7,200.

Private Property Repricing Example: A homeowner with a $600,000 loan currently at 3% repricing to 1.6% (two-year fixed) with their existing bank saves approximately $8,400 annually. After the $800 repricing fee, net first-year savings is $7,600. This homeowner could reprice immediately without worrying about refinancing costs.

Private Property Refinancing Example: The same homeowner could refinance to a different bank offering 1.5% fixed for two years, saving $9,000 annually. After $2,000 in refinancing costs, net first-year savings is $7,000—only $600 less than repricing, but with more flexibility and potentially better long-term features.

When Repricing Makes Sense

Repricing is your best choice when:

The rate gap is small: If your current bank is offering a competitive rate (within 0.3% of the market best), repricing's lower costs make it the winner. You avoid the $1,200+ cost difference between repricing and refinancing.
You want speed: You can enjoy lower payments within one month instead of waiting three months for refinancing to complete.
You're satisfied with your bank's service: If your lender has treated you well and offers reasonable features, there's no need to switch.
You want to avoid lock-in periods: Some repricing packages come without new lock-in periods, giving you flexibility to refinance later if rates drop further.
Your bank offers free repricing: Many banks now include one free repricing or conversion option after the first year, making this an attractive option.

When Refinancing Makes Sense

Refinancing is worth the extra cost and time when:

The rate gap is substantial: If you can save 0.5% or more in interest rates, refinancing typically pays for itself within 12-18 months. A $500,000 loan saves $2,500 annually at 0.5% rate difference—easily justifying $2,000 in costs.
You want better features: Banks competing for your refinancing business offer superior features like penalty-free partial repayment, waiver of penalties when selling, and flexible conversion options. Your current bank may not match these.
You need a different loan structure: If you want to switch from floating to fixed rates (or vice versa) and your current bank's options are limited, refinancing gives you access to the entire market.
You're switching from HDB to a bank: This is refinancing, not repricing. The interest rate difference (often 1% or more) makes it worthwhile despite the costs.
You want to consolidate other debts: Some refinancing packages allow you to consolidate personal loans or credit card debt into your mortgage at lower rates.

The Timing Factor: Lock-In Periods and Interest Rate Trends

Your lock-in period is critical to this decision. Most mortgages in Singapore lock you in for 2-3 years at a fixed rate. You cannot refinance or reprice without penalty during this period.

Current market conditions favor acting when your lock-in period ends. Three-month SORA rates (the benchmark for floating-rate packages) have dropped to 1.34%—the lowest in three years. Fixed-rate packages are available at 1.48-1.6% for two-year terms. Compare this to the 3-4% rates many borrowers locked in during 2023-2024, and the savings potential is enormous.

However, experts predict that the bulk of rate declines have already occurred. Redbrick Mortgage Advisory expects refinancing to moderate from mid-2026 as fewer borrowers will have the motivation to switch. This suggests acting sooner rather than later if you're considering either option.

The chart above shows how dramatically rates have fallen. If your lock-in period ends in 2026, you're in an excellent position to capture these savings before rates stabilize.

The Hidden Decision: Fixed vs Floating Rates

When you refinance or reprice, you'll also choose between fixed and floating rates. This decision affects your total savings calculation:

Fixed-Rate Packages (1.48-1.6% for 2-3 years): Nearly 90% of HDB owners who refinanced in 2025 chose fixed rates, according to OCBC. Fixed rates provide certainty—your monthly payment never changes, making budgeting easier. However, if interest rates fall further, you're locked into a higher rate.

Floating-Rate Packages (currently around 1.34-1.55%): These are pegged to three-month SORA, meaning your rate changes quarterly. They're currently lower than fixed rates, but you face uncertainty if rates rise. Floating rates are better if you believe rates will continue falling or if you plan to refinance again soon.

Many smart borrowers are choosing fixed rates now to lock in certainty, then planning to refinance to floating rates later if the rate environment changes. Some banks now offer free conversion options after the first year, giving you this flexibility.

Step-by-Step: Making Your Decision

Step 1: Check Your Lock-In Period Review your mortgage statement to find when your lock-in period ends. You cannot refinance or reprice before this date without penalty.

Step 2: Get Current Rate Quotes Contact your current bank for their repricing offer. Then, compare rates from other banks using Homejourney's Best Bank Refinancing Rates Comparison 2026: Homejourney Guide to understand the market. You can compare rates from DBS, OCBC, UOB, HSBC, Standard Chartered, and other major banks in one place on our platform.

Step 3: Calculate Your Break-Even Point Use this formula:

Break-Even Months = (Refinancing Costs - Repricing Costs) ÷ Monthly Interest Savings

Example: If refinancing costs $2,000, repricing costs $800, and you save $300/month in interest, your break-even point is ($2,000 - $800) ÷ $300 = 4 months. If you plan to stay in your home for more than 4 months, refinancing wins.

Step 4: Consider Non-Financial Factors Are you satisfied with your current bank's service? Do you value the simplicity of repricing? Or do you want access to better features that only refinancing provides?

Step 5: Factor in Future Rate Expectations If you believe rates will fall further, repricing with a free conversion option might be smart—you can refinance later. If you think rates have bottomed, locking in with refinancing to a better bank might be wiser.

Homejourney's Tools to Simplify Your Decision

At Homejourney, we've built tools specifically to help you make this decision with confidence:

Bank Rates Comparison: View current rates from DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, and other major banks side-by-side. See which banks offer the best rates for your situation and what features each includes.
Mortgage Eligibility Calculator: Understand how much you can borrow and what your monthly payments would be at different rates. This helps you calculate exact savings.
Multi-Bank Application: Instead of visiting each bank separately, submit one refinancing application through Homejourney and receive offers from multiple banks. This saves time and lets banks compete for your business.
Real-Time SORA Tracking: Monitor live 3-month and 6-month SORA rates to understand when floating-rate packages are at their most attractive.
Singpass Integration: Apply via Singpass for instant data verification, faster processing, and simplified documentation.

Visit our When to Refinance Home Loan in Singapore: Homejourney Guide for more detailed guidance on refinancing timing and strategy.

Common Mistakes to Avoid

Mistake 1: Focusing only on interest rates. The lowest rate doesn't always mean the best deal. Factor in all costs, features, and how long you'll stay in your home.

Mistake 2: Serial small repricings. Avoid repricing multiple times with new lock-in periods each time. This can trap you from refinancing to a significantly better deal later. Better to wait and make one good decision.

Mistake 3: Ignoring lock-in period end dates. Mark your calendar. Refinancing or repricing right when your lock-in ends maximizes your savings window.

Mistake 4: Not comparing all options. Some borrowers assume their current bank's repricing offer is competitive without checking the market. You could be leaving thousands on the table.

Mistake 5: Forgetting about cash rebates and subsidies. Many banks offer $1,000-2,000 cash rebates or cover legal fees entirely. These can make refinancing costs negligible.

The HDB-to-Bank Refinancing Trend

If you're an HDB owner, the decision is often clearer. The HDB concessionary loan rate is fixed at 2.6%, while banks are offering two-year fixed rates at 1.48-1.6%. That 1% rate difference is substantial.

However, HDB owners should be aware: once you refinance to a bank loan, you cannot switch back to an HDB loan in the future. This is a permanent decision. Make sure you're comfortable with this before proceeding.

The benefits that make HDB-to-bank refinancing attractive include: