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What is SIBOR and why should you consult LoanGuru

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SIBOR stands for Singapore Interbank Offered Rate. It reflects how much it costs banks to borrow from one another. In Singapore, the SIBOR is set by Association of Banks in Singapore (ABS). Two Banks in Singapore offer SOR loan package while majority of the mortgage lenders in Singapore offer SIBOR based home loan package.

 

SIBOR rates can be found on major financial papers such as The Business Times and other noted newspapers like Bloomberg. SIBOR is also derived from a poll of banks from Mondays to Fridays. ABS obtain rates from 17 banks in Singapore daily to rank the SIBOR rates  in order excluding the top and bottom quartiles.

Due to the complexity of the mortgage loan industry in Singapore, it is crucial to acquire knowledge of the SIBOR as property buyers will be able to reap benefits from the SIBOR. Moreover, due to the SIBOR rate’s transparency, it has become a benchmark rate for residential home loans, commercial loans and overseas property loans denominated in Singapore Dollars.

Home Loan SIBOR Package in Singapore is usually quoted as 1 month or 3 month SIBOR with a certain spread added. As such, SIBOR packages are transparent and also available in packages with or without lock in periods.  There are 2 banks in Singapore offering SOR while the rest of the banks are using SIBOR for their mortgage loan package. Hence, this clearly shows SIBOR’s dominance over SOR.

 

 

 

 

 


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