A fierce home loans war has broken out between DBS Bank and United Overseas Bank (UOB).
The prize is the prospect of financing the purchase of at least 1,225 homes being offered in the year's first two new-property launches.
Both banks are offering a zero-per-cent spread under their fixed-deposit home-loan rate (FHR) packages aimed at projects under construction, with no lock-in period and a one-time free conversion for a limited time only.
The effective interest rate from DBS is 0.6 per cent per annum and from UOB, 0.65 per cent. These are their current FHR rates.
DBS's regular FHR package charges an all-in rate of 1.4 per cent to 1.5 per cent.
The zero-per-cent spread FHR packages applies until the property project receives its temporary occupation permit.
Under DBS's special-promotion package, the 0.6 per cent interest rate is based on its 18-month FHR package.
UOB's package of 0.65 per cent is based on its 36-month FHR.
This story appeared in The Business Times yesterday and has been edited for length.