By Paul Ho (guest contributor)

In this article, we will look at how the Total Debt Servicing Ratio (TDSR) affects refinancing.  According to MAS, if you were to refinance your loan with another bank or even just re-price with the same bank, you will still be required to pass the Total Debt Servicing Ratio (TDSR) requirement of less than 60%. All refinancing will have to pass the TDSR rule.

Why would people get hurt refinancing?

So who are the people who might be hurt? The many who bought their properties using a 35 year loan tenure or under a less strict Debt Servicing ratio of 60% (Note: A Debt Servicing Ratio of 60% is not the same as a Total Debt Servicing Ratio of 60%).

People who borrowed under interest-only financing would also be hurt when interest rates increase as they cannot switch. If they do switch, they will ...