So when I got my HDB couple of years back, we took the POSB HDB Loan instead of the HDB Loan.

The interest rate for this POSB Loan is some mix of short term and long term fixed deposits + a fixed percentage. The best part of this loan is that it is maxed at 2.5% for 8 years. For the past 3+ years, the interest rate has been higher than most floating rate loans but lower than 2.5%. It has been slowly increasing the past few years. Recently, I just received a letter from DBS/POSB to tell me that the interest rate is now at 2.5%.

Also, there is no penalty for prepayment or partial prepayment of the loan.

Now, of course I have already been paying a lower interest rate than many folks who bought their HDB using the HDB Loan, cos that’s 2.6% straight out. Which is 0.1% more than