Bank loan Fixed rate or floating rate better ?

Everything better than hdb loan

Great question—this one hits differently depending on where you are in your financial journey.

I recently worked with a young couple refinancing their first BTO. They were laser-focused on "locking in the lowest rate" but hadn't considered how long they'd actually hold the loan or what else was competing for their cash flow (spoiler: insurance gaps and zero emergency fund).

Here's what most people miss:

Myth 1: "Fixed is always safer." Fixed rates protect you from rate hikes, yes—but you pay a premium for that certainty. If you're planning to refinance in 2–3 years anyway (common for first-timers optimizing), you might overpay for protection you won't fully use.

Myth 2: "Floating is just gambling." Not if you stress-test it. Can your budget absorb a 1–2% rate jump without touching essentials or protection coverage? If yes, floating often wins over 3–5 year horizons.

What I've seen work in practice:

1. Match the loan structure to your life stage. Early career with income growth ahead? Floating gives flexibility. Settled income, maxed-out commitments? Fixed buys peace of mind.
2. Stress-test before deciding. Run scenarios at +1.5% and +2.5% rates. If either breaks your budget, fixed might be worth the premium—or you need to rethink affordability.
3. Integrate with your full picture. If fixing the loan means delaying critical insurance or skipping CPF top-ups, you're solving the wrong problem first.

The "best" rate is the one that lets you sleep soundly while building long-term wealth.

Curious—has anyone here refinanced recently? What tipped your decision toward fixed or floating?

Depends on the rate you get

Fixed rate if it is already low. Floating rate if the interest rates when you sign is high.