The Fifth C

Fixed vs Floating Home Loan Rate: Which Saves More?

Model your home loan with any fixed and floating rate scenario. See total interest paid under each option and a full year-by-year amortisation schedule.

Home Loan Comparison

Fixed vs floating rate · Full amortisation

Fixed 3yr + Float

$2,319 (fixed)

$2,556 (float)

Total Interest

$258,121

All Fixed @ 2.8%

$2,319

Total Interest

$195,700

All Floating @ 3.8%

$2,556

Total Interest

$275,200

Choosing fixed+floating over all-floating saves $17,079 in interest over 25 years (assuming rates don't change).

Show year-by-year repayment schedule
YearPhaseMonthlyYear InterestBalance
1Fixed$2,319$13,821$485,993
2Fixed$2,319$13,424$471,589
3Fixed$2,319$13,015$456,776
4Floating$2,556$17,123$443,228
5Floating$2,556$16,599$429,155
6Floating$2,556$16,055$414,538
7Floating$2,556$15,490$399,356
8Floating$2,556$14,903$383,586
9Floating$2,556$14,293$367,207
10Floating$2,556$13,660$350,195
11Floating$2,556$13,002$332,525
12Floating$2,556$12,318$314,171
13Floating$2,556$11,609$295,108
14Floating$2,556$10,872$275,308
15Floating$2,556$10,106$254,742
16Floating$2,556$9,311$233,380
17Floating$2,556$8,485$211,193
18Floating$2,556$7,627$188,148
19Floating$2,556$6,736$164,211
20Floating$2,556$5,810$139,349
21Floating$2,556$4,849$113,526
22Floating$2,556$3,850$86,704
23Floating$2,556$2,813$58,845
24Floating$2,556$1,736$29,908
25Floating$2,556$617$0

Floating rate is an assumption — actual floating rates (SORA-pegged) change with market conditions. Lock-in periods and clawback clauses may apply. Consult your bank for exact terms.

Fixed vs Floating: What the Rate Difference Means in Real Money

Bank home loans in Singapore are priced off SORA (Singapore Overnight Rate Average), which moves with global rate cycles. Fixed-rate packages lock your rate for 2–3 years — providing payment certainty but usually at a slight premium over the prevailing floating rate. After the fixed period, most packages convert automatically to a floating rate pegged to SORA.

The key question: how much does monthly payment certainty matter to you over the next 2–3 years? A 1% rate rise adds roughly $200–$400/month to a $500k loan depending on tenure. If you're stretching near the MSR limit, that swing can stress household cash flow. If you have a comfortable buffer, floating rates have historically averaged lower than fixed over 10+ year horizons — but past cycles don't guarantee future outcomes.

Worked example — $500,000 loan, 25-year tenure

Fixed 2.8% for 2 years $2,323/mo

Predictable. $55,752 paid over 2 years. Converts to floating after lock-in ends.

SORA + spread today (~3.5%) $2,503/mo

Higher now, but falls if SORA drops. $60,072 over 2 years at current rates.

If SORA rises to 4.5% $2,741/mo

Floating worst case — $65,784 over 2 years, ~$10k more than the fixed option.

Use the calculator above to model your actual loan size. Rates shown are indicative — confirm current fixed and floating spreads with your bank before committing.

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Home Loan Rates — Frequently Asked Questions

What is SORA and how does it affect my home loan?
SORA (Singapore Overnight Rate Average) replaced SIBOR as the main floating rate benchmark for Singapore home loans from 2024. Most bank floating rate packages are now pegged to 3-month compounded SORA plus a spread (typically 0.5–1.5%). As SORA changes with market conditions, your floating rate mortgage payment will change accordingly.
Is a fixed or floating home loan better in Singapore?
Fixed rates (typically 2–5 years) offer payment certainty and protection against rate rises, but start higher than floating rates. Floating rates start lower but carry interest rate risk. In a rising rate environment, fixed is safer; in a falling rate environment, floating benefits you more. Most borrowers choose a fixed period of 2–3 years then refinance.
Can I refinance my HDB loan to a bank loan?
Yes, you can refinance from an HDB loan to a bank loan at any time after fulfilling HDB's minimum occupancy period (typically 5 years for resale, or after key collection for BTO). Bank loans offer lower initial rates but require at least 5% cash downpayment on the outstanding loan amount and have TDSR requirements.
What are typical home loan lock-in periods in Singapore?
Most Singapore bank home loans have lock-in periods of 2–5 years. During this period, prepayment, redemption, or refinancing typically incurs a penalty of 0.75–1.5% of the loan amount redeemed. After the lock-in period, you can refinance freely, though legal and valuation costs apply.
How much does it cost to refinance a home loan in Singapore?
Refinancing costs include legal fees ($2,000–$3,000), valuation fees ($200–$600), and potentially a prepayment penalty if within lock-in. However, many banks offer legal fee subsidies to attract refinancing customers. Net savings from refinancing need to exceed these costs to make sense — typically only worthwhile if rates differ by at least 0.5%.