SORA Linked Home Loans Explained Complete: Bank Rate Comparison Guide

SORA linked home loans are floating-rate mortgages pegged to the Singapore Overnight Rate Average (SORA), Singapore's primary benchmark for home financing since SIBOR's phase-out in 2024. This guide compares current 2026 rates across major banks like DBS, OCBC, and UOB, helping you choose the best option for your HDB or private property purchase.

At Homejourney, we prioritize your safety and trust by verifying live rates daily and offering side-by-side comparisons from all partner banks. Track SORA loan Singapore trends securely on our bank rates page to make confident decisions.

What is SORA and Why It Matters for Your Home Loan

SORA, published by the Monetary Authority of Singapore (MAS), is the volume-weighted average rate of overnight unsecured borrowing transactions in the SGD interbank cash market between 8am and 6.15pm.[7] Unlike SIBOR, which was quoted rates prone to manipulation, SORA is transaction-based, making it more transparent and reliable.[1]

Banks use compounded SORA over 1-month, 3-month, or 6-month periods for floating-rate home loans, smoothing out daily fluctuations for stable repayments.[1][4] This replaced SIBOR-pegged loans by end-2024, affecting all major lenders including DBS, OCBC, UOB, HSBC, and Standard Chartered.[2]

For Singapore home buyers, SORA reflects local interbank costs influenced by global factors like US Fed policies. In 2024, 3-month compounded SORA averaged 3.50%-3.62%, but by late 2025, it fell to 1.2%-1.34%, driving lower mortgage rates.[1][2][6]

3-Month vs 6-Month SORA: Key Differences for Borrowers

3M SORA uses the compounded average over the past 90 days, adjusting quarterly for moderate stability. It's popular for balancing responsiveness to rate drops with protection from short spikes.[1][4]

6M SORA averages over 180 days, changing semi-annually for even greater stability but slower reaction to falling rates. Choose 3M SORA in declining markets to benefit quicker; opt for 6M if prioritizing predictability.[4]

Feature	3M SORA	6M SORA
Adjustment Frequency	Quarterly	Semi-annually
Stability	Moderate	Higher
Best For	Rate declines	Risk-averse borrowers

The chart below shows recent SORA rate mortgage trends in Singapore, highlighting 3M and 6M movements over the past 6 months:

As seen in the chart, SORA hit 3-year lows around 1.2% by late 2025, with 3M SORA at 1.34% expected to hover at 1.3%-1.4% into 2026.[2][6]

SORA vs SIBOR: Why the Switch Happened

SIBOR, phased out since March 2022, was forward-looking and less transparent. SORA vs SIBOR comparison shows SORA's backward-looking, transaction-based method reduces manipulation risks and better reflects actual costs.[1][5]

Post-transition, nearly all floating loans are now SORA home loan packages. Fixed-rate loans (2-5 year lock-ins at 2.4%-2.9%) remain an alternative for stability, popular with 80% of OCBC customers in 2025.[2]

2026 Bank Rate Comparison: SORA Loan Singapore Packages

Current 3M SORA packages add a bank margin (0.4%-0.7%) to the benchmark. Example for a S$500,000 loan: At 1.34% 3M SORA + 0.5% margin = ~1.84% effective rate, saving ~S$4,100 yearly vs higher 2024 rates.[2]

DBS: Competitive 3M SORA + 0.45% margin; strong for HDB refinancing.[2]
OCBC: 3M/6M SORA options + cash rebates; popular fixed-SORA hybrids.[2]
UOB: SORA-pegged with flexible conversions post-year 1.[3][6]
HSBC/Standard Chartered: Low margins for high-value loans; legal subsidies.[1]
Maybank/CIMB/RHB: Attractive for investors; compare via Homejourney.[8]

Visit Homejourney's bank rates page to compare live rates from DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, RHB, Public Bank, Hong Leong, and Citibank side-by-side. Use our mortgage calculator at https://www.homejourney.sg/bank-rates#calculator for instant payments.

Fixed vs Floating: SORA Decision Framework

Floating SORA linked home loans suit those expecting rate cuts (e.g., first-time HDB buyers in Punggol or Tengah). Fixed loans fit budget-focused families amid uncertainty.[2]

Assess risk tolerance: Conservative? Go fixed or 6M SORA.
Check economic outlook: US Fed cuts favor 3M SORA.[1][2]
Calculate affordability: Use Homejourney's eligibility tool.
Factor TDSR: Max 55% of income for debt; HDB caps apply.[6]
Refinance if rates drop: HDB owners saved switching to bank SORA loans vs HDB's 2.6%.[6]

Submit one Singpass-enabled application on Homejourney to get personalized offers from all banks, streamlining your process safely.

Actionable Steps to Secure the Best SORA Home Loan

1. Track live 3M/6M SORA on Homejourney bank rates.

2. Input details into our calculator for monthly estimates.

3. Compare packages: Prioritize low margins, rebates, no lock-in fees.

4. Apply via Singpass for instant verification; connect with our mortgage brokers.

5. Pair with property search on https://www.homejourney.sg/search to find HDB flats under budget.

Disclaimer: Rates fluctuate; consult professionals. Homejourney verifies data for trust but is not financial advice.

FAQ: SORA Linked Home Loans Explained

What is a SORA home loan in Singapore?
SORA loans are floating mortgages tied to compounded SORA plus a bank margin, replacing SIBOR for transparent pricing.[1][7]

3M SORA vs 6M SORA: Which is better now?
3M SORA for faster rate drop benefits in 2026's low environment; 6M for stability. Compare on Homejourney.[4]

How do SORA rates affect my payments?
At 1.34% 3M SORA + 0.5% margin, a S$500k loan costs ~S$2,100/month (25 years). Use our calculator.[2]

Can I refinance my SIBOR loan to SORA?
Yes, many HDB owners are switching to cheaper bank SORA packages. Check eligibility on Homejourney.[6]

Where to compare SORA bank rates?
Homejourney's bank-rates page shows all major banks live. For more, see our pillar SORA Home Loans Singapore Guide.

Ready to compare SORA Linked Home Loans Explained Complete: Bank Rate Comparison Guide? Start on Homejourney for safe, verified rates and multi-bank applications today.