QUOTE(sunnyckh @ Mar 29 2012, 05:48 PM)
gonna sign my LO later and still considering whether to take MRTA or MLTA...
googled some info and this is what i got -- looks like a MLTA makes more sense... Not sure how the premium looks like though..
"MRTA = Mortgage Reducing Term Assurance = Normally can be purchased from any banks, if you are thinking of protecting your asset against death and total permanent disability. Get advice from your banker as they will provide MRTA loan on top of your housing loan to cover your purchase.
Now, in layman terms, MRTA has a reducing premium over time thus, as you pay your loan, the amount you owe the bank would reduce and the amount you need to be insured for would also reduce. Hence it is an expense item for your personal profit and loss as you dont get a single cent out of it and honestly, come on, what are the odds of someone being approved for loan dying before repaying their loan? I doubt banks are willing to take on so much risk.
My advice to you, refinance your loan ASAP and get an MLTA (Mortgage Level Term Assurance) as by doing so, you reduce your repayment amount and turn your expense (MRTA) into an asset (MLTA). In other words, if something happens to the policyholder, the repayment will be covered by MLTA thus you get to keep your asset, and if nothing happens, you get your money back, and probably with higher interest than what a bank would give. Thus a WIN WIN situation.
Now, a brief overview of MLTA versus MRTA.
1. MLTA = flexi insurance, MRTA = term insurance
2. MLTA = level protection, MRTA = reducing protection
3. MLTA = low initial premium, MRTA = high initial premium (burden)
4. MLTA = tax relief up to RM6000, MRTA = no tax relief
5. MLTA = cash return(asset) MRTA = no cash return (expense)
6. MLTA = transferrable, MRTA = non transferrable
7. MLTA = death/tpd/critical illness + premium waiver, MRTA = death and tpd only
8. MLTA = level premium, MRTA = higher premium if financed by bank as it is tied to BLR
If your property is for investment purpose, MLTA would be a good choice as technically you would be selling the property after a few years and you do not need to repurchase your insurance. Now if you would like to take advantage and receive sound financial advice please feel free to contact me for FREE advice @ 012-2112036, I am a partner with Prudential and naturally, you would want the best assurance for yourself."
extracted from:
http://thinkproperty.com.my/realestate/For...TA-VS-MLTA.html No plagirising.. ahahahaha ..