...at its discretion (for home loan)? For example, if it is set out that it will be based on BLR - 2% for first five years and etc...

Can bank change it to BLR - 1% in the third year?

Got such thing?

I don't think they can vary the rate. The only rate that will change is the BLR.

nope the bank cant change it as they like... unless in the event of default

just refer back to your original Letter Offer.

This post has been edited by merce: Oct 29 2009, 06:10 PM

The "+" or "-" BLR is fixed. The BLR is not. Simple as that.

take ING or AIA if want fixed.

My "north-west" wind tells me that no standardisation of interest rates for housing or mortgage loans

But didn't mention the increase of interest rate la...

"Chuah Mei Lin, executive director of The Association of Banks in Malaysia , clarifies that there can be no standardisation of interest rates for housing or mortgage loans. “The rates are determined individually by the commercial banks taking into account, in the main, factors such as the banks' funding cost and/or the cost of doing business and business strategies."

I think we all as forumers had done a "good job" in grapping attention from the media

"Talk has been rife that the housing loan interest rates will be revised upward with effect from November. Mortgage brokers and property investors claimed in online forums as well as through e-mail communication that banks were instructed to 'standardise' the interest rates of their mortgage packages. The alleged new spread has been speculated to be no higher than BLR-1.8%, a big jump from the current BLR-2 to BLR-2.5 spread."

http://www.theedgemalaysia.com/personal-fi...n-of-banks.html

at the same time, the bank must get approval from bank negara..

Bank negara will make sure there's a healthy competition.. basically, making sure their rate are comparable with each other.. and not killing each other..

bank negara sets the OPR (overnight policy rate, now 2%). then the banks are given full liberty to set a BLR above that, based on whatever (well, their cost + the profit they want). normally all banks will choose the same BLR, because of competition (now 5.55%; i think one bank chose 5.5%).

then your loan agreement is fixed at BLR +- something%. but since the banks can modify their own BLR, then basically the banks can adjust your % according to their whim la. if bank negara asks, they'll just say their costs have increased, bla bla bla... that's the current rule.

Thats rite lar, i alsways mention to others that BLR is not under BNM control, is only normal practice they follow OPR changes in a same different and direction. But still got many people dun understand.