Cheaper home loan from foreign banks. Save $500 per year!!

Savings of up to $500 in first year; low Sibor rate is to their advantage. Three of such foreign banks mentioned in the article are RHB, Maybank and Citibank. Something you may want to seriously consider if you're thinking to refinance your mortgage.

RECORD low interest rates are allowing some foreign banks to offer cheaper mortgages than their local rivals.

The difference between the best floating rates at a foreign bank and that at a local one means savings of only $42 or so a month on a $1 million loan.

With local banks having to service the high costs of maintaining branches and cash counters, they will not be as free to make razor-thin cuts to mortgage rates.

Mortgages for less

* One of the best deals from a local bank currently comes from OCBC, with a first-year rate at three-month Sibor plus 0.55 per cent, working out to 0.99 per cent.

* Foreign banks are offering better rates for their first year: Malaysia's RHB is offering 0.90 per cent; Maybank, 0.94 per cent; and Citibank, 0.96 per cent.

* Take a home buyer with a 30-year, $1 million loan. The monthly difference between the first-year loans for OCBC and Maybank comes to about $42 a month, or about $500 a year. There may still be savings in subsequent years, depending on how the rates move.

From Straits Times, "Getting a home loan from a foreign bank may be cheaper".

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