• Matthias Ferrieres

Comparing Floating Rates versus Fixed Rates

Let’s look at the lowest rates available for both fixed and floating rates based on different loan amounts as examples. Please note that these rates and packages are still available at the time of this writing but may change or expire at a later time.



For a $1,000,000 loan

  • Lowest fixed rate: 2.75% fixed for first 2 or 3 years

  • Lowest floating rate: 1.75% linked to board rate for first 2 years or 1.77% linked to SORA rate first 3 years


For a $500,000 loan

  • Lowest fixed rate: 2.75% fixed for first 2 or 3 years

  • Lowest floating rate: 1.85% linked to board rate for first 2 years or 1.87% linked to SORA rate for first 3 years


As observed from the above examples, there is an almost 0.90% to 1.00% difference between the lowest fixed and floating rates available for the 2 example loan amounts. Which also means that if these differences remain largely unchanged, the annual dollar value will approximately be about $4,500 (difference in interest payable) for a $500,000 loan, or almost $10,000 for a $1,000,000 loan, discounting some reduction effects as a result of amortization.


For many owners including myself, such dollar differences are significant. Hence, we will need to research, and/or discuss these options extensively with our mortgage advisors to decide how viable it will be to our medium/long term management of our property/home financing.


Especially if there is/isn’t a real possibility that these interest differences may be closing up (or not) in the face of inflation or even an impending recession (or stagflation, a combination of both).



Source: Alvin Lock

Alvin has enjoyed extensive success with more than 11 years of experience and track record in Retail and Private Banking. His core expertise encompasses a full spectrum of wealth management services including Investment Advisory, Portfolio Management and Financing, Margin Trading, Legacy Planning, and Property Loans.

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