Interest rates for housing loans in Singapore are usually quoted as a fixed rates or SIBOR

Banks often publicize their housing loan interest rate, but they seldom explain the workings of a home loan. While a housing loan is not very simple to understand, it isn’t rocket science either. In this article, we try to explain the workings of a housing loan, but first, you need to understand a few key terms:

Principal of a Housing Loan

The principal of a housing loan is basically the amount borrowed and not yet repaid. For housing loans, interests are usually charged on this principal amount.

Housing Loan Interest Rate

Interest rates for housing loans in Singapore are usually quoted as a fixed rates or SIBOR + a fixed value, in case of floating interest loans. For example, a floating rate loan could be quoted as SIBOR +1.25%.

Loan Tenure

The loan ...