What is SORA?
SORA (Singapore Overnight Rate Average) is the interest rate benchmark for Singapore dollar financial contracts. Published daily by the Monetary Authority of Singapore (MAS), it replaced SIBOR (Singapore Interbank Offered Rate) for mortgage loans from 2024 onwards.
SORA measures the volume-weighted average rate of overnight borrowing transactions in Singapore's unsecured interbank market. Unlike SIBOR, which was a forward-looking rate, SORA is backward-looking — calculated based on actual transactions.
How SORA Affects Your Mortgage
Most SORA-pegged mortgages use the 3-Month Compounded SORA, which averages the daily SORA rates over the previous 3 months. Your mortgage rate is then:
Your Rate = 3M Compounded SORA + Bank Spread
Bank spreads in 2026 range from 0.82% to 0.95% p.a. With 3M SORA at approximately 3.20% in April 2026, effective SORA mortgage rates are around 4.02%–4.15% p.a.
SORA vs Fixed Rate: Which is Better in 2026?
In the current environment where SORA rates are elevated, 2-year fixed rates (3.08%–3.25% p.a.) are lower than effective SORA rates (~4.02%–4.15%). If you believe SORA will fall significantly in the next 2–3 years, locking in a fixed rate now and then switching to SORA after the lock-in period could be optimal.
How SORA Rate Changes Affect Your Monthly Repayment
A 0.5% increase in SORA translates to roughly S$200–S$300 more per month on a S$1 million, 25-year mortgage. It is important to stress-test your budget against potential SORA increases before committing to a floating package.
Fixed Rate Lock-in and Penalties
Most fixed-rate packages have a 2–3 year lock-in period. Refinancing or making large capital repayments during lock-in typically incurs a penalty of 0.75%–1.5% of the outstanding loan amount. Plan your lock-in exit strategy before signing.
Calculate Your Mortgage
Use our mortgage calculator Singapore to model your repayments at current SORA and fixed rates, including a full amortization schedule.