Choosing between the different types of home loans in Singapore is one of the most important decisions you will make as a home buyer, upgrader, or investor. The wrong choice can cost you tens of thousands in extra interest over your loan tenure, while the right structure can give you flexibility, peace of mind, and long‑term savings.
This definitive Homejourney guide breaks down every major mortgage type in Singapore, explains how HDB and bank loans really work, and shows you how to compare packages safely and confidently. Drawing on real examples from the current market, we will help you understand fixed rate vs floating, SORA loan packages, HDB vs bank loans, and refinancing options — all within the regulatory framework of MAS and HDB[4].
Throughout this guide, we will also show you how to use Homejourney’s tools — from the bank rates comparison to the mortgage eligibility calculator and one‑click multi‑bank application — so you can make secure, well‑informed decisions at every step.
Table of Contents
- 1. Overview of Home Loans in Singapore
- 2. Regulatory Framework: MAS, HDB, and CPF Rules
- 3. HDB Housing Loan vs Bank Housing Loan
- 4. Main Types of Bank Home Loans
- 5. Understanding SORA Home Loans
- 6. Fixed Rate vs Floating Rate: Deep Comparison
- 7. Loan Structures by Property Type (HDB, Condo, Landed, EC)
- 8. Key Affordability Rules: TDSR, MSR, LTV, and CPF Usage
- 9. Refinancing, Repricing, and Switching Loan Types
- 10. Practical Decision Frameworks and Real‑World Scenarios
- 11. How Homejourney Helps You Compare and Apply Safely
- 12. Frequently Asked Questions
1. Overview of Home Loans in Singapore
In Singapore, most homes — whether a 4‑room HDB flat in Punggol, a private condo in Tampines, or a landed home in Serangoon Gardens — are financed through either an HDB housing loan or a bank home loan[4]. Your choice affects your downpayment, monthly instalments, flexibility, and risk exposure.
Broadly, the main types of home loans in Singapore are:
- HDB concessionary housing loan for eligible buyers of HDB flats
- Bank loans for HDB and private property (condos, ECs, landed), including:
- Fixed rate home loans
- Floating rate home loans (usually SORA‑pegged)[4]
- Hybrid or stepped‑down structures (fixed for a period then floating)
- Specialised loans such as building‑under‑construction (BUC) loans, bridging loans, and term loans (for equity / cash‑out financing)
Bank packages are offered by major players such as DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, RHB, Public Bank, Hong Leong Bank, and Citibank. Interest rate structures vary by bank and package, but most are anchored to either fixed promotional rates or a benchmark like SORA plus a bank spread[3][4].
Why loan type matters more than most people think
For a typical couple buying a $600,000 4‑room resale HDB near an MRT station (for example, in Pasir Ris or Queenstown), the difference between two loan packages that vary by just 0.5% in interest can add up to tens of thousands over 25–30 years. On the East‑West Line, many flats near stations like Bedok or Clementi command higher prices, so an extra 0.5% interest makes an even bigger impact.
That is why Homejourney emphasises safety, transparency, and comparison — so you do not commit to a package you later regret. You can always see current rates and structures across banks via Bank Rates before making a decision.
2. Regulatory Framework: MAS, HDB, and CPF Rules
Home loans in Singapore operate within a robust regulatory framework designed to promote financial stability and protect borrowers. The key players are:
- Monetary Authority of Singapore (MAS) – Sets rules like the Total Debt Servicing Ratio (TDSR) and Loan‑to‑Value (LTV) limits.
- Housing & Development Board (HDB) – Provides HDB loans to eligible flat buyers and sets HDB Loan Eligibility (HLE) criteria.
- CPF Board – Governs the use of CPF Ordinary Account (OA) funds for downpayment and instalments[4].
Key regulatory concepts (simplified)
- TDSR: Limits your total monthly debt obligations (including all loans) to a percentage of your gross monthly income (commonly 55%).
- MSR: For HDB and EC buyers, caps your monthly housing instalment at a percentage of your gross monthly income (often 30%).
- LTV: Caps how much you can borrow relative to the property value or price (whichever is lower).
- CPF withdrawal limits: Restrict how much CPF OA you can use based on the property’s remaining lease and valuation limits[4].
These rules shape what mortgage types you qualify for, how much you can borrow, and how long you can stretch your tenure.
3. HDB Housing Loan vs Bank Housing Loan
For HDB buyers, the first big decision is usually: HDB loan or bank loan? This is a core part of any home loan comparison in Singapore.
3.1 HDB Housing Loan: Features and Eligibility
An HDB housing loan is a concessionary loan offered directly by HDB to eligible flat buyers. According to CPF Board and HDB guidelines, the key features include[4][8]:
- Interest rate: 2.6% per annum, pegged at 0.1% above the prevailing CPF OA rate (currently 2.5%), and reviewed quarterly[8].
- LTV: Up to around 75–80% of the purchase price, depending on prevailing rules and your profile[4].
- Downpayment: At least 20–25% of the purchase price, which can be fully paid using CPF OA (no minimum cash component)[4].
- Lock‑in period: Generally no lock‑in, offering flexibility to refinance to a bank loan later[4].
Eligibility criteria include citizenship, monthly household income ceilings, and restrictions on owning private property. These are periodically updated by HDB, so always check the latest rules on the HDB website.
3.2 Bank Housing Loan: Features
A bank housing loan is offered by commercial banks such as DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, RHB, Public Bank, Hong Leong Bank, and Citibank. Key features include[3][4]:
- Interest rates: Market‑based, either fixed for a period (e.g. 2‑year fixed) or floating (typically SORA + spread). These can be lower or higher than HDB’s 2.6% depending on market conditions[3][4][8].
- LTV: Up to 75% of the property value or purchase price, whichever is lower, subject to MAS LTV rules and your existing loans[4].
- Downpayment: Typically 25% of purchase price; at least 5% must be in cash, the remaining 20% can be CPF OA or cash[4].
- Lock‑in period: Usually 2–3 years, during which early redemption or refinancing may attract penalties[2][4].
3.3 HDB Loan vs Bank Loan: Summary Comparison Table
Local insight: How Singaporeans usually choose
Among young couples buying their first BTO in estates like Sengkang, Punggol, or Tengah, many prefer starting with an HDB loan because of the lower cash requirement and stable 2.6% rate, then consider refinancing to a cheaper bank loan later if market rates fall. Buyers of resale flats near MRT hubs like Kallang or Redhill — where prices are higher — are more sensitive to interest rates and may lean towards bank loans if fixed or SORA packages are significantly below 2.6%.
Homejourney’s Bank Rates page lets you quickly see if current bank packages are substantially lower than 2.6%, helping you decide whether sticking with HDB or switching to a bank makes sense for your situation.
4. Main Types of Bank Home Loans
Once you choose a bank loan, the next big decision is which mortgage type to pick. In Singapore, bank home loans are mainly categorised by interest rate structure:
- Fixed rate home loans
- Floating rate home loans (SORA‑pegged or other internal benchmarks)[3][4]
- Hybrid or stepped packages (fixed then floating)
- Special purpose loans (BUC loans, bridging, term/cash‑out loans)
4.1 Fixed Rate Home Loans
A fixed rate home loan means your interest rate is locked in (e.g. 1.80% p.a.) for a specified period, often 2–3 years, regardless of market movements[3][4]. After this period, the loan usually reverts to a floating benchmark such as SORA plus a spread.
Fixed rate packages are widely offered by DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, RHB, and others. Promotional rates and lock‑in terms vary by bank and property type[3]. For detailed strategic comparisons on fixed vs floating, refer to our specialised guides: Fixed Rate vs Floating Rate Mortgage: Which to Choose via Homejourney , Fixed vs Floating Home Loans: Bank Rate Comparison Guide | Homejourney , and Fixed vs Floating Rate Mortgage: Which to Choose in Singapore | Homejourney .
4.2 Floating Rate Home Loans (Typically SORA‑Pegged)
Floating rate home loans are pegged to a variable benchmark plus a bank spread. Since MAS shifted away from SIBOR/SOR, most banks now use SORA (Singapore Overnight Rate Average) as the benchmark[1][4].
Common structures include:
- 3M SORA + spread (rate resets every 3 months)[3][4]
- 1M SORA + spread (rate resets monthly; more responsive but more volatile)[3]
- Occasionally internal bank board rates or fixed deposit‑linked rates for some banks
Example: A Maybank package might quote 3M SORA + 0.40%, while a DBS package might offer 3M SORA + 0.50%[3]. If 3M SORA is currently 2.5%, your effective rate would be 2.9% (2.5% + 0.4%) or 3.0% (2.5% + 0.5%).
For deeper analysis specific to SORA loans, see our SORA‑focused guides: SORA Linked Home Loans Explained: Complete Guide & Alternatives | Homejourney , SORA Linked Home Loans Explained: Cost Guide 2025 | Homejourney , and SORA Linked Home Loans Explained: 2025 Guide by Homejourney .
