Mortgage Repricing vs Refinancing in Singapore: Which Saves More Money?

Thinking of lowering your home loan interest rate? Learn the difference between mortgage repricing and refinancing, the costs involved and how to determine which option could save you more money.

If your home loan lock-in period is ending, you may have come across the terms mortgage repricing and mortgage refinancing.

Many homeowners think they mean the same thing.

They don't.

Both can help you lower your home loan interest rate and reduce your monthly repayments, but they work in different ways.

Understanding the difference can help you make a better decision and potentially save thousands of dollars over the life of your loan.

What Is Mortgage Repricing?

Mortgage repricing means switching to a new home loan package with your current bank.

You stay with the same bank but move to a different interest rate package.

For example:

• Current bank: Bank A
• Current rate: 2.50%
• Repricing offer: 1.65%

You keep the same lender and enjoy a lower interest rate.

In most cases, repricing is simpler because you do not need to switch banks.

What Is Mortgage Refinancing?

Mortgage refinancing means moving your home loan from your current bank to another bank.

For example:

• Current bank: Bank A
• New bank: Bank B
• New rate: 1.50%

The new bank takes over your mortgage and offers you a new home loan package.

Refinancing allows you to compare rates across different banks instead of being limited to the options offered by your current lender.

Repricing vs Refinancing: What's the Difference?

The biggest difference is simple.

Mortgage Repricing

• Stay with your current bank
• Usually less paperwork
• Usually faster
• Limited to packages offered by your bank

Mortgage Refinancing

• Move to another bank
• More paperwork
• Takes longer
• Access to more options across the market

What Are Home Loan Rates Like Today?

At the time of writing, many competitive home loan packages in Singapore are around 1.45% to 1.70%, depending on the bank, property type and loan package.

If you are paying significantly more than current market rates, it may be worth reviewing your mortgage options.

Even a small reduction in interest rates can translate into meaningful savings over time.

The Best First Step: Compare Both Options

One of the biggest mistakes homeowners make is assuming that refinancing is automatically better because the interest rate is lower.

The best approach is usually:

Step 1: Get a Repricing Offer

Contact your bank and ask what repricing packages are available.

Step 2: Compare Refinancing Options

Look at what other banks are currently offering.

Step 3: Calculate the Actual Savings

Compare both options after taking all costs into account.

Only then can you determine which option truly saves more money.

A Lower Interest Rate Doesn't Always Mean More Savings

Many homeowners focus only on the advertised interest rate.

However, a lower rate does not always mean higher savings.

For example:

Option A – Repricing

• Interest rate: 1.65%
• Legal fees: $0

Option B – Refinancing

• Interest rate: 1.50%
• Legal and valuation fees may apply

At first glance, refinancing looks like the obvious winner.

However, you should also consider:

• Legal fees
• Valuation fees
• Subsidies provided by the new bank
• Outstanding loan amount
• Remaining loan tenure

The good news is that many banks offer legal subsidies for refinancing, subject to meeting their minimum loan amount requirements.

In some cases, these subsidies can fully cover the legal costs.

This is why it is important to compare the total savings, not just the interest rate.

Example: Repricing vs Refinancing Savings

Let's look at a simple example.

Outstanding loan amount: $800,000

Repricing

• Interest rate: 1.65%
• Costs: $0

Refinancing

• Interest rate: 1.50%
• Legal costs fully covered by bank subsidy

In this situation, refinancing may provide greater overall savings because the lower rate comes with little or no additional cost.

However, if the loan amount is much smaller, the outcome may be very different.

Every case should be evaluated based on the actual numbers.

When Does Repricing Make More Sense?

While every homeowner's situation is different, repricing is often worth considering when:

• Your outstanding loan amount is relatively small
• Your bank's offer is already competitive
• The savings from refinancing are limited
• You prefer a simpler and faster process

In many smaller loan cases, the potential savings from refinancing may not be enough to justify the additional costs or effort involved.

When Does Refinancing Make More Sense?

Refinancing is often worth considering when:

• Your outstanding loan amount is larger
• Another bank offers a significantly lower rate
• Legal subsidies are available
• The overall savings are substantially higher

Even a small difference in interest rate can result in significant savings when your loan amount is large.

Can a Mortgage Broker Help With Repricing?

This is something many homeowners do not know.

Mortgage brokers cannot directly arrange repricing because repricing is handled by your bank's repricing department.

However, mortgage brokers work closely with banks and regularly monitor refinancing packages across the market.

While we cannot negotiate your repricing package, we can help you determine whether your bank's offer is competitive compared to refinancing alternatives available from other banks.

In many cases, we can quickly identify whether it is worth staying with your current bank or exploring other options.

Frequently Asked Questions

Can I refinance during my lock-in period?

Usually yes, but penalties may apply. It is important to calculate whether the savings outweigh any lock-in penalties before proceeding.

Is repricing free?

In many cases, repricing comes with little or no cost, although this varies between banks.

How often should I review my home loan?

A good rule of thumb is every one to two years, or 3-6 months before your lock-in period ends.

Is refinancing always better than repricing?

No. The lowest interest rate does not automatically mean the highest savings. Costs, subsidies, loan amount and loan tenure should all be considered.

Should I get a repricing offer before refinancing?

Yes. In most cases, it makes sense to obtain a repricing offer from your current bank first and compare it against refinancing options available in the market.

So, Should You Reprice or Refinance?

There is no one-size-fits-all answer.

The right choice depends on:

• Your outstanding loan amount
• Your current interest rate
• Your repricing offer
• Available refinancing rates
• Legal subsidies and fees
• Remaining loan tenure

That is why comparing rates alone is rarely enough.

The best decision comes from comparing the actual dollar savings of both options.

Need Help Comparing Repricing and Refinancing Options?

At Loan Experts, we help homeowners compare both repricing and refinancing options based on actual numbers.

We review available rates, potential costs, legal subsidies, and projected savings so you can make an informed decision.

If your lock-in period is ending or you are unsure whether you are overpaying on your mortgage, speak with our team for a complimentary mortgage review.

We'll help you determine whether repricing or refinancing makes more financial sense for your situation.