Updated 26 Sep 2026. If you may sell your home soon, a cheaper mortgage rate is only part of a refinancing decision. You need to know what the loan will cost until the sale completes, including the cost of entering the new package and leaving it again.
A two-year interest saving is of limited use if you redeem the loan after eight months and trigger an exit charge. Equally, staying on an expensive package without checking alternatives can cost money. Compare written offers against realistic sale dates, rather than treating either choice as automatically safer.
Put the possible redemption dates first
Write down three scenarios: an earlier sale, your expected sale and a later sale. For each, ask the current lender and any proposed lender for the applicable interest schedule and redemption costs. The date you hope to list the property is not the date the mortgage is repaid.
Ask your conveyancing lawyer how the sale completion and redemption timetable will work. If the new home purchase depends on proceeds from this sale, also build a separate completion cash budget. The mortgage comparison below is not a calculation of your eventual sale proceeds, CPF refund or property taxes.
MoneySense distinguishes repricing with your existing lender from refinancing with another lender. It recommends comparing alternatives and checking fees, clawbacks and a new lock-in. Use the MoneySense home-loan guide as a starting checklist, then obtain the terms for your actual account and offer.
Ask for an exit-cost sheet, not just a rate
| Item to confirm | Written answer you need |
|---|---|
| Lock-in or commitment period | Start and end dates, trigger for charges, and how any charge is calculated. |
| Subsidy clawback | Which benefit is repayable, its separate expiry date and the amount at each proposed exit date. |
| Redemption notice | Required notice, when it is treated as received and any interest payable for insufficient notice. |
| Sale-related waiver | Whether it exists, which charge it covers, evidence required and conditions or exclusions. |
| Switching costs | Legal, valuation, administrative or conversion charges and any subsidy actually confirmed. |
| Cancellation before drawdown | Any liability if the sale proceeds sooner and the accepted refinancing is no longer needed. |
Do not merge these into one “penalty-free date”. A lock-in, notice requirement and clawback may involve different terms. If a salesperson describes a waiver, ask for the clause and written confirmation that your proposed sale qualifies. Treat an unanswered item as unresolved, not as a zero-dollar cost.
As a concrete bank-specific example, DBS’s mortgage-management page, checked on 26 September 2026, states two months’ notice or two months’ interest in lieu for early redemption, with other charges potentially applying. For a sale it directs customers to appoint a law firm to serve the notice. Its full-repayment guidance also makes redemption subject to the Letter of Offer and applicable fees or clawbacks. This is not a statement that every Singapore bank uses the same notice period.
Compare costs over the period you will keep the loan
The following example uses invented inputs solely to demonstrate the decision. It is not a current bank offer, interest-rate forecast or estimate for a particular borrower. Assume both alternatives start with the same principal and use the same repayment term. At a hypothetical redemption after 12 months, their repayment schedules show:
| Cost until redemption | Stay | Refinance |
|---|---|---|
| Interest over 12 months | S$24,000 | S$19,200 |
| Switching costs at the start | S$0 | S$2,500 |
| Exit charges at month 12 | S$0 | S$4,000 |
| Total comparison cost | S$24,000 | S$25,700 |
Here the assumed interest reduction is S$4,800, but switching and exit costs total S$6,500. Refinancing costs S$1,700 more over this period. If the new loan’s S$4,000 exit charge were genuinely waived under the signed terms, its total would instead be S$21,700, a S$2,300 saving. A verbal expectation of a waiver is not enough to use that second result.
This simplified comparison excludes costs identical under both alternatives and includes no cashback. In your own comparison, include every differing charge and confirmed benefit, and avoid counting a subsidy twice. Recalculate for earlier and later redemption using fresh schedules and the terms applicable on those dates. Do not assume that interest savings accrue evenly each month.
Principal repayment is not itself an interest expense. A smaller monthly instalment can partly reflect slower repayment, especially if you extend the loan term. Keep track of instalments for cash flow and the remaining principal for redemption, while comparing interest and fees as costs. Use the same period and a consistent method for both alternatives.
Consider repricing and waiting as actual alternatives
Request an existing-bank repricing offer as well as an outside-bank offer. Check its fee, any new commitment and whether sale-related terms differ. Staying temporarily may make sense in one set of costs; repricing or refinancing may win in another. There is no universal percentage-point drop that makes switching worthwhile for every loan.
If the sale is uncertain, do not construct the entire decision around the most convenient date. Ask what happens if the buyer’s completion is later, you decide to keep the property, or the new purchase falls through. Choose terms you can afford under plausible alternatives, including a higher ongoing rate where the package is variable.
Protect the household payment routine
Until the bank confirms the changeover, keep track of the existing repayment schedule. Agree who will check the redemption statement, settlement date and first new instalment. If CPF is involved, confirm the required payment instructions and timing with the bank and CPF Board. Do not assume an old arrangement automatically becomes the new one.
Keep switching expenses separate from money reserved for the next home’s completion, renovation and household bills. For an investor, test the decision without assuming uninterrupted rent or an immediate sale at the asking price. For an owner-occupier, consider the disruption if the financing timetable collides with the move.
The useful decision is specific: “At these possible sale dates, these written terms produce these costs.” That is a stronger basis than a headline rate or a claim that now is the best month to refinance.
For the wider cost comparison, read our mortgage refinancing cost guide. For the execution stage, see documents, CPF and the payment changeover.
Sources and correction note
The official MoneySense and DBS pages linked above were opened and checked on 26 September 2026. This guide is a comparison method, not a product recommendation or financing approval. Confirm eligibility and contractual terms with the lender for your circumstances.
This revision removes unsupported live-rate and savings claims, the incorrect suggestion that a refinance generally requires a fresh 5% cash down payment, and blanket eligibility tests from the previous version. It also replaces unverified household case stories with a clearly hypothetical calculation.
Featured photograph: terraced houses at Serangoon Terrace, Singapore, photographed in 2014 by ProjectManhattan. Source, CC BY-SA 3.0. Resized archive photograph for housing context; no loan, valuation or sale status is implied for these homes.
