– its highest rate hike since 1994. This would set the Fed’s benchmark federal-funds rate – or in layman’s terms, the rate banks lend to each other – to between 1.5 per cent and 1.75 per cent.Yes, we can hear you swear and curse expletives your grandma would feel embarrassed over.
While the new 0.75 per cent-point hike was announced on June 15, 2022, the Federal Reserve raised interest rates by 0.25-percentage points in March and another 0.5-percentage point in May. It looks like this homeowner’s home loan is pegged to DBS’ Fixed Deposit Home Rate . The bank’s FHR is tied to the average value of its 12-month and 24-monthAs the bank revises its 12-month and 24-month Singapore Dollar Fixed Deposit rates to 1.150 per cent and 1.300 per cent respectively, the homeowner’s FHR will also be revised from 1.025 per cent to 1.225 per cent per annum .
What this also means is that if there hasn’t been an interest rate cap on his contract, he could effectively be paying a higher interest rate than if he had remained on his HDB home loan.Here’s another letter, also from DBS, from a different homeowner living in a private condominium. While there is a rate increase, the condo owner isn’t affected because his loan account is currently still on a fixed rate. He refinanced his condo loan in 2020, taking up a three-year fixed rate package, so the FHR will affect his mortgage only from next year.Finally, a third homeowner shared this letter from OCBC. Dated June 13, 2022, it’s an advisory that his existing home loan interest rate will be revised from 2.8791 per cent to 3.58786 per cent per annum ., which is at 1.