Be careful with Citibank housing loan

[stanip]

I thought I was safe to sign up a 1 month sibor+0.6% housing loan with Citibank in 2011 for 25 years not to worrying about keep refinancing every two three years.

Two weeks ago, I received a surprise Citibank letter advising me that they have raised the interest spread to sibor + 0.85%. I wrote to complain about their unilateral move to increase the spread without my consent. They told me that in the loan agreement, there was a fine-print saying that Citibank has the right to increase the spread at their discretion! I was shocked as I never realized that a bank can do that with our housing loan. I hope this is just Citibank and not all banks in Singapore...

Anyway, since I complained, they offered me 2 options: (i) a slight improved rate at sibor +0.75% for 3 years then jumping to sibor +1.1% after OR (ii) stay with their latest increased spread of sibor +0.85% "forever" but they made no commitment that they would not change their spread again in the near future. Any advice on which option I should take or I have better options to refinance out from Citibank?

Be careful if you want to sign up new loans with Citibank...

 

[tk]

refinance with other banks lor..

 

[luei74]

Refinance with local bank...

 

[Carnage]

Take the 3 years option then refinance with other banks.

 

[stanip]

Thanks for your advice.

I'll start calling up a few banks to check my refinancing options and compare to taking the Citibank first 3 years offer first then refinance after.

After all the tightening, our government no longer gives us the same freedom to refinance like the old days. I am afraid with my age, I can no longer get back the same tenor... but will explore.

Any good refinancing offers that you would recommend?

 

[derong07]

Hi, you may wanna try asking DBS. Currently, they should have a 3yrs fixed package rate for (completed) HDB & Pte properties at 1.78%.

if u need any contacts for banker can juz pm me.

Thanks for your advice.

I'll start calling up a few banks to check my refinancing options and compare to taking the Citibank first 3 years offer first then refinance after.

After all the tightening, our government no longer gives us the same freedom to refinance like the old days. I am afraid with my age, I can no longer get back the same tenor... but will explore.

Any good refinancing offers that you would recommend?

 

[stanip]

Thanks.

Just contacted DBS, they are increasing their fixed rate offer to 1.88% today...

 

[cscs3]

I thought I was safe to sign up a 1 month sibor+0.6% housing loan with Citibank in 2011 for 25 years not to worrying about keep refinancing every two three years.

Two weeks ago, I received a surprise Citibank letter advising me that they have raised the interest spread to sibor + 0.85%. I wrote to complain about their unilateral move to increase the spread without my consent. They told me that in the loan agreement, there was a fine-print saying that Citibank has the right to increase the spread at their discretion! I was shocked as I never realized that a bank can do that with our housing loan. I hope this is just Citibank and not all banks in Singapore...

Anyway, since I complained, they offered me 2 options: (i) a slight improved rate at sibor +0.75% for 3 years then jumping to sibor +1.1% after OR (ii) stay with their latest increased spread of sibor +0.85% "forever" but they made no commitment that they would not change their spread again in the near future. Any advice on which option I should take or I have better options to refinance out from Citibank?

Be careful if you want to sign up new loans with Citibank...

You never read term and condition carefully?

 

[cscs3]

Thanks.

Just contacted DBS, they are increasing their fixed rate offer to 1.88% today...

Interest rate is on the raise. This is quite expected and many has expect this will happen.

 

[nicesingapore]

few years ago, my friend opted for hdb loan at 2.6% ... another opted for bank rate. After 10 years, the first who opted for hdb loan paid the most in terms of interest.

although sibor increase it may not added up to 2.6% over the entire tenure especially if there is a refinancing term.

example hdb at 2.6% x 5 years = at least 10%+ excluding compound
bank rate avg 1.5% x 5 years assuming start at 0.5->0.085->1.8% ... nett 8%.
The risk is bank foreclosure if cannot pay up. If one is prudent then foreclosure should not be the worry.

 

[ipaq4444]

few years ago, my friend opted for hdb loan at 2.6% ... another opted for bank rate. After 10 years, the first who opted for hdb loan paid the most in terms of interest.

although sibor increase it may not added up to 2.6% over the entire tenure especially if there is a refinancing term.

example hdb at 2.6% x 5 years = at least 10%+ excluding compound
bank rate avg 1.5% x 5 years assuming start at 0.5->0.085->1.8% ... nett 8%.
The risk is bank foreclosure if cannot pay up. If one is prudent then foreclosure should not be the worry.

quote for calculation later

 

[NewsBar]

You guys sign without reading the fine print. Black and white, you lose already.

Post for friend

"
I am one of the Citibank customer that is affected.
I want to go for collective loan with other bank
I created facebook group "Singapore home grouploan"
Welcome all person to join me and any interested borrower to join.
Hope grouploan work as well as groupbuy.
Cheers!!!
"

 

[SKWSMC]

few years ago, my friend opted for hdb loan at 2.6% ... another opted for bank rate. After 10 years, the first who opted for hdb loan paid the most in terms of interest.

You mention 10 years ago. So is in 2005 or so. During that time bank interest where got so low?

 

[limtianchye]

I thought I was safe to sign up a 1 month sibor+0.6% housing loan with Citibank in 2011 for 25 years not to worrying about keep refinancing every two three years.

Two weeks ago, I received a surprise Citibank letter advising me that they have raised the interest spread to sibor + 0.85%. I wrote to complain about their unilateral move to increase the spread without my consent. They told me that in the loan agreement, there was a fine-print saying that Citibank has the right to increase the spread at their discretion! I was shocked as I never realized that a bank can do that with our housing loan. I hope this is just Citibank and not all banks in Singapore...

Anyway, since I complained, they offered me 2 options: (i) a slight improved rate at sibor +0.75% for 3 years then jumping to sibor +1.1% after OR (ii) stay with their latest increased spread of sibor +0.85% "forever" but they made no commitment that they would not change their spread again in the near future. Any advice on which option I should take or I have better options to refinance out from Citibank?

Be careful if you want to sign up new loans with Citibank...

do you mind sharing what was the justification?
thanks

 

[ses009]

It is not only Citibank, all banks have the rights to raise the interest rates and terms and conditions. All these are written in the thick Memorandum of Mortgage.

 

[valenrina]

It is not only Citibank, all banks have the rights to raise the interest rates and terms and conditions. All these are written in the thick Memorandum of Mortgage.

You are quite right about that. Now SIBOR and SOR all increasing across the board. My mortgage loan was with ANZ at some point in time it was so low and now it's more than 2%. Ugh! I just refinanced my loan to a fix 2-years package at very good rates. You guys should really consider it. Mine was like group loans where the broker consolidate those interested parties in my EC and talk to the banks for us. He's not with any bank so no need to be tied to anyone. If you are considering refinancing your loans can try www.loanworks.com.sg.

 

[layman]

It is not only Citibank, all banks have the rights to raise the interest rates and terms and conditions. All these are written in the thick Memorandum of Mortgage.

You are quite right about that. Now SIBOR and SOR all increasing across the board. My mortgage loan was with ANZ at some point in time it was so low and now it's more than 2%. Ugh! I just refinanced my loan to a fix 2-years package at very good rates. You guys should really consider it. Mine was like group loans where the broker consolidate those interested parties in my EC and talk to the banks for us. He's not with any bank so no need to be tied to anyone. If you are considering refinancing your loans can try www.loanworks.com.sg.

the SIBOR/SOR are based on the fixing conducted by ABS from rate contributions provided by the contributing banks, and they are increasing.. but the issue in this thread is that banks unilaterally increase the lending spread against the rate benchmark

 

[henrylbh]

the SIBOR/SOR are based on the fixing conducted by ABS from rate contributions provided by the contributing banks, and they are increasing.. but the issue in this thread is that banks unilaterally increase the lending spread against the rate benchmark

Increasing the spread subsequently is a breach of trust. The lender should specifically state so in the letter of offer. If it is there, TS can only suck thumb.

 

[wolverine23]

anymore bad experience with Citibank?

What about for fixed rate? can they amend anytime?