DBS raises mortgage rates to 3.5% per annum

SINGAPORE: DBS Bank, Singapore's largest lender, has raised the rates on its fixed rate home loans to 3.5 per cent per annum.

Four fixed rate packages were available, ranging from two to five years, according to a check on its website on Tuesday. All four are set at 3.5 per cent per annum.

After another steep interest rate hike by the US Federal Reserve last month, DBS removed all fixed rate mortgages from its website.

The same fixed rate of 3.5 per cent applies to its two-in-one home loans, which allows borrowers to structure up to half of their loan amount in fixed rates and the rest under a floating rate package.

In the end of June, DBS adjusted its home loan rates. It then increased the rates on its two-year and three-year fixed rate packages to 2.75 per cent per annum, while scrapping a five-year fixed-rate package for Housing Board flat buyers.

The bank introduced a new home loan package last week, allowing new and existing HDB flats earning less than S $2,500 a month to take a mortgage with POSB at 2.6 per cent per annum. This rate is similar to that of a HDB housing loan.

For now it has kept its floating rate mortgages unchanged, which is pegged to either the bank's six month average fixed deposit rate or the Singapore Overnight Rate Average SORA.

There are similar reviews at the two other local banks.

UOB told CNA on Sep 23 that it would stop offering its two-year and three-year fixed rate packages, whose rates were raised to 2.98 per cent and 3.08 per cent per annum back in June, as it reviews its offerings.

OCBC said in response to questions on the same day that it was still offering a two-year fixed rate package at 2.98 per cent. It has been removed from its website since early last week.