Hi all,

First, let me first say that I am not able to find a suitable forum category to post this topic. Please move it to the appropriate place if there is one.

I have recently booked a new double storey link house in Putra Heights costing around 350k. Currently, there are 2 banks which are willing to offer me the 90% loan which are RHB and Public Bank. The S&P will be under 2 names. Mine and my girlfriend (which we will marry soon). The problem is that RHB does not offer a withdraw facility if I make extra repayments. Public Bank on the other hand, does offer such facility but requires both me and my gf name on the loan agreement as well. This complicates situation as she is still a student graduating in 1 month, and having a 2k housing loan on her name would probably she would never be able to buy a car until she earns 4-5k.

Since my repayment period is quite long (35 years RHB and 40 years PB), able to make extra payments can reduce the loan duration as both these loans are daily rest (like most of the others). However, not having a withdraw facility means that I will not be able to withdraw the extra money should an emergency happen.

RHB is the panel bank for my housing project whereas Public Bank is not. I'm not too sure what are the negative implications of having a non-panel bank as my end financier. The developer advise me to get a panel bank but I'm open to the bank that can give me the best offer.

Anyone have advise which bank I should go for? What would you do if you were in my shoes? Thanks

Thanks for your feedback, guys.

The 2 banks I have mentioned did agree to give me 90% loan. I do agree that Maybank was absolutely horrible. BCB loan goes by monthly rest if I am not mistaken. HSBC does offer a nice package, but to get my dream house a 30 year loan might have trouble getting through. Most banks give a maximum of 30 years except RHB,Public Bank, Maybank and Affin Bank. Public Bank told me they can finish processing the loan application after 2 weeks whereas RHB bank told me they can get back to me by the end of the week.

I was looking at a low rates for the first few years because I need the extra money for furnishing and stuff which is why I did not opt for a fixed rate. Unfortunately, there's no one else I can depend on for joint loan application. My future wife curently does not own a car and we don't plan to get another car so soon. Maybe after a few years. My job doesn't move around so I'll be more environmental (and economically) friendly by using 1 car for the time being.

Both the mentioned banks said the I can qualify for 90% loan based on their prelimanary calculation. I'm not sure how reliable the information I receive from this mortgage loan officer is. I've heard cases that banks can just reject your application without any reason. I'm not opting for having the legal fees covered by the bank.

I think it's probably safer for me to choose a panel bank (RHB) as this is what the developer adviced me. HongLeong bank was not on the panel bank either but I'll check them out as well. Thanks for the tip! I am thinking if I should be one of those kiasu guys that go apply bank loan at every bank or just apply a few banks and wait.

p/s: Is there a more appropriate forum category where this post should be? Maybe there should be a new category under lifestyle that deals with finance issues such as house loans, credit cards, EPF, income tax and boring but essential stuff like that.

This post has been edited by normaldude: Apr 19 2006, 12:41 AM

Citibank and Standard Chartered can only give MOF up to 85% for my case. HSBC offered 90% and for 30 years whereas the 2 banks that I mentioned offered repayment periods that is more than 30 years. Since it is daily rest, I can still save shorten the tenure by repaying faster.

The issue I want to highlight here is not the fact of whether I am eligible for the 90% loan, but which should I choose if both these banks approved my loan? Since I myself is qualified to get the loan, I don't see why another name that currently does not earn any money needs to be placed on the loan agreement. a + b is still a if b is 0 . If she was earning, I would understand the logic that adding her salary would make me in a better position to get the loan, but this isn't the case now.

Anyway about the furnishing and stuff, I opted for a 0% interest the first year so I have more money to do that. I can afford the repayment of ~2k myself currently and my future wife will be working soon (1.5 months) and will be getting a job which pays aroudn 2k. My car is finish paying in 2 years when the house will be completed. I'm not too concern bout the repayment amount but more like the importance of a withdraw facility vs the freedom of my future wife not to be bounded by the loan. So if next time wanna buy a new car or another house.. I can still use her name mah since mine got quite a lot of commitments dy.

Or another question is panel bank (no withdraw facility) vs non panel bank (with withdraw facility). I'm not too sure the implications of non-panel banks. Developer say chance of late payment by the bank is higher which will cause the borrower to pay the fine.

This post has been edited by normaldude: Apr 19 2006, 01:16 AM

Actually the longer repayment period is a form of safety net for me. That's why I'm trying to opt for loans > 30 years if possible. This brings my monthly installment to around 1.8-1.9k, which I feel is still manageble for me. This will also soon be my only commitment (tho it is a high commitment) as my car will be finish paying dy. Also it will probably easier to approve also, coz the monthly installment is lower.

Of course the safety net by taking longer loan tenure may be much more costlier, but my preception is once can earn more money, can pay what is comfortable then. Maybe 1 month can pay 3-4k also. I don't want to get lower margin of financing as I want to use some money for furnishing the new house as this will cost a lot. I'm also paying for the legal fees instead as I find that having the bank cover your legal fees is not such a good deal after all. I don't want to over commit now, so if banks can give me 90% MOF, I'll take it. The mortgage officer did ask about other debts/loans as well and that's where I find different banks have different policies.

Some count the total value of all your credit card limits combined.
Some just count the outstanding balance of your CC bill every month.
Some count your average monthly spending on CC.
Some don't count it at all, only if you are blacklisted or not.
Some ask for the monthly car loan installment.
Some ask for the outstanding car loan balance.
Some ask for when the repayment finishes.
All ask if got good payment records.

To be frank, I have lots of credit cards, but most are dormant. I don't hav e any outstanding balances every month. My payment record is pretty good on my car loan, except I was late for the first payment only. I'm getting around 5.5k/month so 1/3 of it is around 1.8k which is what I get for loans above 30 years. Some banks count 2/5 (40%) instead. But some banks hor.. they add with the car installment as well, so if my car I pay RM 500 / month, I have to earn 6k to qualify. Some don't count like that. I also confused how all the banks count. Different bank count different things different way.

BTW, the titles are individual. What do you mean by charged titles? What are chargor banks? Are they the same as panel banks? I don't think those big foreign banks (Citibank, HSBC, Standard Chartered) is suitable for me coz I am small fry business to them. If I have so much money.. I no need to apply loan loh. Smaller local banks want my business more.. so I go to them. Actually if I want to, I can go for 85% MOF, but now I rather spend that 5% on furnishing my house.

You guys all so expert leh. Some loan officer I talk to quite blur like that.. make me feel not very confident of them. I guess flexibility and safety nets do have their trade offs as well. Thanks for your great comments!

Hi everyone,

Just want to set the record straight on a few things first

1. My gf is in her mid 20s, so it may be young or it may b old to some people. I only said she was still studying but not her age. FYI, she's 25 and I'm 26.
2. I didn't say she's not paying for anything. More than half the downpayment is coming from her, so it's still fair that her name is on the S&P even if it is not on the loan agreement
3. I'm sorry I have to disagree about getting the house another time because 10% of a 350k house is 35k, and I don't intend to burn that money now.

I'm drawing up a move in budget soon and will try my best to stick with it

Here's my current status with regards to the loan application:

RHB -> APPROVED!!!
Public Bank -> Processing
UOB -> Just applied

RHB is almost perfect for me except of the no withdrawal thingy. I'm almost certainly cancelling Public Bank because of the 2 name thingy now. Initially I applied for Public Bank as well because of fear that my RHB loan could not get approved for whatever reason.

However, a few hours after I applied for the UOB loan, the RHB mortgage girl call me and say my loan is approved! YAY!

RHB is giving me this offer:
1st year: 0%
2nd year: BLR -1.25%
Thereafter: BLR + 0.1%

Loan tenure 35 years @ RM 1921/month. Daily rest, no withdraw facility. RHB is the panel bank for my housing project

UOB is offering me this:
1st year: BLR - 4.25%
2nd-5th: BLR -1%
Thereafter: BLR + 0%

Loan tenure 30 years @ RM 1961 / month. Daily rest. Withdrawal facility available. Non-panel bank.

I guess I prefer the lowest 1st year rate (RHB). Anyways I think I have to forget bout withdraw facility and just save seperately for rainy days. If I don't have to pay anything for first year, I could have an extra 10k or so for furnishing and moving in costs. Actually I aim to complete my loan at around 24 years (if everything goes well).

Cheers!

Hi Dreamer,

The answer to your question is A.

Cheers

My parents paid around 167k for a house around 15 years ago. The market value of the same house is currently around 330k. Anyway, I heard some rumours that price of house is increasing by 10% after middle of this year due to higher raw material costs. Not too sure how true is this information. Also heard BLR is going up soon but it should not affect me until the second year.

Hi Dreamer,

I was not thinking of the house as my investment, but more like just a home and a place to live and settle down. A house is probably not a very good "investment" compared to investing in stocks, etc. but it is probably better than upgrading a car.

I'm technically still 25+ until very late of the year and have not quite reach 6k, but still in the mid 5k+. I guess I am in the correct job as I like my job and do understand that I am getting paid reasonable well for my age & experience (which is around 3-4 years).

I do think I have a bit of luck in getting where I am now, but I definitely do not think that I am rich in any way. Mid 5k+ probably used to be big money, but I do think it is not as big as it used to be due to higher cost of living. I hear fresh grads now can get 3.5k? My first job paid 1.5k only . I'm still driving my trusty old Proton which is about to finish paying soon (my first car).

You probably could say that I am not overly ambitous. I'm not keen on starting a business as that would require a lot of money and I won't risk leaving my current job. If I was earning 2-3k the risk is not so great but if I don't succeed in business, it will be difficult for me to find a job that pays 5-6k.

I think I can breach the 10k mark eventually, but now I am still young so I'll wait for my turn. According to the salary evaluation, I have not even reach mid point salary for my job grading yet. And my job grading is only in the middle bracket.

It's very difficult to get rich when working for other people. Unless for some luck/reason the employee stock options that I am currently holding can suddenly cash in for a lot of money. It's not that easy to become a millionaire, whether own business or working for other people.

Since I'm not overly ambitous, what I plan to do is actually finish paying off all my debts first. Housing loan, car loan, PTPTN, etc. Once I've done all of that, I can probably look ahead at midlife and start thinking more about investing.

I'm just a normal dude. I'm not a doctor/pilot/expatriate. I don't have rich parents and am from a middle income family. I don't want/need a bugalow house or fancy car. This 350k house is just a double story link and is in a neighborhood that I like. You can say it is something of my dream house that I had always wanted to get and willing to fork out the money to get it. Of course I do not want to get shortchanged by any banks, so I'm being cautious before signing the loan agreements with the banks.

Regarding the main topic..

UOB did give me a call and said that they can give me 0% for the first year too. RHB bank has already approved my loan and is pressing me to sign the loan papers already and I'm giving them excuses to delay the signing until I hear about my loan application from UOB. Public Bank is probably too slow and by the time they get back to me, I would have already signed for another bank.

The difference between RHB bank and UOB bank is actually RHB bank is offering me a 35 year loan and UOB is offering me a 30 year loan for an additional monthly installment of RM 40. Both rates are according to BLR (except the first year), and UOB is giving me a BLR + 0 instead of BLR + 0.1 as offered by RHB for the subsequent years.

So now my decision is currently favouring UOB until another bank calls me up and give me a different package.

p/s: Anyone knows how much time I have to sign the loan offer letter after the loan has been approved? Is it a standard thing or varies between banks? I'm considering now what should I do if I have to give an answer to RHB before I know the result of my loan application from UOB.