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Why Getting the Right Advice Is Important When Choosing a Home Loan and Where You Can Get It (2023)

PropertyGuru Editorial Team
Why Getting the Right Advice Is Important When Choosing a Home Loan and Where You Can Get It (2023)
When searching for the home of your dreams, the next thing on the mind of most people will probably be how to finance it. A home loan is an important part of completing your property purchase in Singapore.
With record-high HDB resale flat prices and continually climbing private property prices, finding the right home loan is more essential than ever. You want to ensure that you get the most savings and remain comfortably committed for the rest of your financial obligation, especially in the era of rising interest rates.
So, how do you choose the right one? Here’s the outline of our article, click to jump ahead:

What Makes Advice ‘Right’ in a Mortgage Context?

Reliability of Mortgage Advice

Providing honest and unbiased advice makes up the basics of what counts as being a mortgage advisor. Here, we refer to information tailored to benefit you and your unique financial situation and not for someone else’s profit.
When it comes to obtaining reliable advice in choosing home loans, your mortgage advisor’s experience and relevant industry knowledge matter. For instance, a mortgage expert who has been dealing with HDB and private property loans for over a decade would potentially be able to give you more credible and extensive advice compared to one who has just joined the field for two years.
Bankers may be better primed to offer you advice if you have decided on a specific bank to obtain the loan. However, if you have yet to narrow your options, mortgage advisors can likely give you more holistic advice on the range of loans offered by different banks.
To give you a better idea of what to look out for, here is a quick checklist when choosing a reliable mortgage advisor for your next home loan:
  • Credentials
  • Relationship/access to banks/financial institutions
  • Years of relevant experience in the field
  • Service(s) provided (e.g. if it is a one-stop streamlined service from start to finish for the application process)
  • Fees and interests charged (if any)

Relevance of Advice to Your Financial Needs

With the fast-changing property market in Singapore, it is crucial to obtain updated advice in line with rules and regulations. This is because using outdated information may lead to wrong decisions and affect your financial health in the longer term.
For example, the Mortgage Servicing Ratio (MSR) of 30% now takes into consideration a 3% interest rate floor. This means the amount you can loan is affected, and by extension, the type of property you can afford to comfortably finance. A good advisor would be able to assess your situation accurately and provide you with relevant options.
Between a fixed vs floating rate home loan, which one makes sense for your financial needs? Should you use your CPF to pay off your home loan? What about whether you should take a SIBOR- or SORA-pegged loan?
Planning and research are crucial when selecting a home loan in Singapore. You’ll also want to have the right someone to help you exercise financial prudence and see that you do not overstretch yourself.

Why Does the ‘Right’ Advice Matter?

While there is no single right way to manage your finances, there are certainly some lessons that only experience can teach.
For instance, you may be thinking of taking on a larger loan to finance a property you like. But this would require you to pay a higher interest rate amount and remain in debt longer. So, should you go for your dream home or buy a more affordable property?
With reliable advice from an experienced mortgage expert, you will gain a broader perspective on the pros and cons and better decide if you should enter the market. Getting the ‘right’ advice straight off the bat will allow you to make sound and more informed financial choices effectively.
You can also speed up the loan application process with the help of an expert. Having your application vetted by a professional can prevent save on critical oversights as your advisor can take care of all the paperwork and nitty-gritty details!

Will I Benefit From Getting the ‘Right’ Advice?

Suppose you have read through our Home Financing articles and feel that you are already armed with sufficient knowledge of obtaining a home loan that best suits you.
Great, but if you are feeling unsure, it always makes sense to get a second opinion before securing a mortgage. After all, two heads are (usually) better than one and obtaining professional advice would be greatly helpful for many people.
Given the sea of home loan information on the internet, picking out sound advice can be confusing, especially when you come across contradicting information.
Who can benefit most from getting the ‘right’ advice? We recommend you save time, effort, and money by speaking to an expert if you are:
  • A first-time home buyer
  • A first-time investor
  • An elderly unfamiliar with digital devices and online process

What Are Useful Sources of ‘Right’ Information?

With the rise of fake news and the spread of misinformation in recent years, it is vital that you obtain your information from credible and legitimate sources that are up-to-date.
Here are some resources you can use to fact-check on the latest procedures and requirements when deciding on your next home loan:
While you can take advice from your relatives and friends, it may be good to take it with a pinch of salt unless they are professionals!

Get It Done Right With PropertyGuru Finance

The final decision on which home loan to choose rests with you, but it doesn’t hurt to seek out professional advice.
Our experienced Mortgage Experts are always ready to provide you with smart and honest advice, the way you want it. The best part? Our services are free!
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Disclaimer: The information is provided for general information only. PropertyGuru Pte Ltd makes no representations or warranties in relation to the information, including but not limited to any representation or warranty as to the fitness for any particular purpose of the information to the fullest extent permitted by law. While every effort has been made to ensure that the information provided in this article is accurate, reliable, and complete as of the time of writing, the information provided in this article should not be relied upon to make any financial, investment, real estate or legal decisions. Additionally, the information should not substitute advice from a trained professional who can take into account your personal facts and circumstances, and we accept no liability if you use the information to form decisions.

More FAQs About Getting Home Loan Advice in Singapore

Most people would either apply directly to their bank or get mortgage advice from a mortgage advisor.

A mortgage advisor could help you save time and money by guiding you through the process and suggesting the best loan for your specific needs.

To ensure that you are getting sound advice from a professional, you should learn about your advisor's credentials, organisation, and experience level.

Information may vary based on the individual, but most will receive advice on their eligibility for a loan, competitive rates, and assistance with their application process.

When negotiating with your bank fails, you can speak with a mortgage advisor who will try to match you with a bank that may be more comfortable accepting your loan.