hi , my debt is about 1 million, hope to get advice from sifu here
i got 50k cash now, how should i use it now?

house 1 , debt 443k installment 2600/month , interest rate blr-2.3 - no rental
personal loan 41k, 24 month now left 18 month , rm1815, interest 3.13%
house 2, debt 460k - DIBS, will need to serve the installment 1Q 2015, installment about 2.1k a month, BLR-2.4
car loan , 100 k , interest 2.48 % monthly installment 1874, 5 year,

how should i restructure my debt?

my income to debt ratio is 90 % at this moment

This post has been edited by homosapien8888: Nov 10 2014, 06:37 PM

which house are u staying in?

U need to sell 1-house ASAP.

Hopefully, the value of your house has appreciated enoug to pay off your P-Loan also

so yr monthly comitment is around 8k and yr income is around 10k

rent out one of yr house if possible ?

if can get 3k its good enough. At least u still have half of yr income.

wow, you're one of the hero who contributed to malaysia high family debt to gdp ratio.

rent can get 3K ?? what type house ?? where ?? also want !!

lose 1 house, lose the car..get a cheaper car

Settle the loan with the highest interest first.
I presume the personal loan will be the highest interest among all.
Settle the 41k personal loan with your 50k on hand.
Try rent out 1 property, aim for rental at least equal to your installment, therefore less 1 worry.

car is a new car, cannot sell
house no1 is landed house, buying for capital appreciation, not selling unless bankrupt.
rental sure not good.my wife dont let me rent out as she dont want any1 to damage he house. Currently i m staying with my family. i m leaving the houseno 1 empty

This post has been edited by homosapien8888: Nov 10 2014, 06:53 PM

guys normally if house 1MIL
can get rent like how much ?
5k - 10k ??

i got 50k cash now. what is my option>?

value for house no 1 is 850k (last bank valuation)
shall i refinance?

personal loan is settled now will get penalty 5 %. so not worth it since the interest is only 3.13 %

Few good options given above by other sifus d...It's clear enough that something needed to be done to restore your finance health index.

Nothing can be changed, if you yourself dun change the mindset.

Anyway, no worries, you'll automatically know what to do exactly, when the real situation comes..

Interest 3.13% per month or 3.13% per year?

3.13% PA ..yearly

Trade in to a smaller (and cheaper) car. Improve your cash flow by getting part time job.

This post has been edited by tohtiengchiah: Nov 10 2014, 07:11 PM

ok.. on & off doing part time now
how to use my 50 k at this moment?
put in FD or dump into loan..?

i still haven't touch my money in EPF...

I too think sell of 1 house is best option, other method consists high risk of losing more, if you die2 wanna keep the 1st house then sell off the one VP soon, settled your personal loan with the profit you made.

Why keep an empty house not renting out nor live in ?

I can only says you can't afford both house with your current income.

I would give up the first house as 850K is quite high even if it reaches 1M on day it's quite difficult to find buyer, then you have huge surplus to play with, unless you intend to live in it near future.

Now you paying for nothing apart collecting dust & spider webs,...LOL

Talk to wife would she rather you go bankrupt soon ? Quite sure she understand.

Keep the 50k for emergency lah ! 50K really nothing nowadays, already you over indebtedness still wanna Hantam till zero saving meh.

salary increasing, more interested on how to max up the 50k lol...
my holding power very strong.. not thinking to dispose my property.
...
well supported in case anything happen

Keep the 50K, no need FD, but safer will be FD. For me, sell the car. The house rent it out. Work part time. Get a higher salary full time job.

thanks for the advice.i had think hard b4 buying a car. expecting it will suck up my cash. but what to do , nowaday ppl see what car u drive, u drive old car , no salesman will entertain u, yr friend will think u r not doing well. it took me 11 year b4 i change my old car to my new car. thats the reality in life

This.

Your biggest cash-milking are 1. Personal Loan & 2. DIBS House

Focus on making these two your priority to settle, i.e. pay off PL and rent out 2nd house possibly equal to your bank payment

personal loan 3.13%, how to get this offer?

Split the 50k. 25k into 1st house as advance payment.. 1 year no need to worry about the loan repayment. Another 25k. Dump 15k into personal loan. Few months no need worry about payment. Left 10k. Dump this into car loan as advance payment or 2nd house loan. Like this, it ll flex your monthly commitment n u have surpluses of salaries on hand in which u can accumulate another bag of cash or savings after 6 months later n think what to do with the new savings. Still have epf to pay house no. 1 later if cash flow is tight. This is what I ll do.

wow,....good and fresh ideas. learn another tips today.

any possibility you taking UOB bank, HSBC bank , citibank, maybank am bank, public? you will get to see BBW very soon upon defaulting

personal loan 3.13% per annum? if that's the case, don't pay them back cause that's lower than FD rate of above 4%

use the 50k as downpayment for a subsale property around <RM300k for rental play. If cannot get loan already, refinance house no.1 for extra cash flow.

if those are not to your taste, I think the most viable option is change wife.

how much landed wanted to sell? wnted what area maybe

refinance hard, you already 90% debt right? if i am not wrong, you wont have ability to repay, i know refinance can get cash, but need to pass threshold first..

further more once refinanced, property need to sell above million but you bought time to service loans

thanks for yr advice. i have an idea how to use my 50k edi
cannot change wife la.

lol.. ask wife to chip in for repayments... 100k volks? civic?

actually whenever i borrow loan, the bank officer also say hard to approve need alot of document, but once my application reach to their HQ, my loan will eventually approved by HQ

This post has been edited by homosapien8888: Nov 10 2014, 10:03 PM

bro, you sure you going to do this? debt on top of debt...

dont want to touch money from " women"

nope .. i bought a segment D car

bank call to offer , some time u just need to be nice to the tele banking...

was thinking about it

my loan remaining amount about 444k
if i refinance 850k( current market value)
i will get 400 k cash le

thanks a very good advice

My 2 cents:

1. Don't refinance - give yourself some room to breath

2. If you need a 100K car to "cari makan", keep it. Indeed, nowadays people ARE superficial. Look at what you use, wear and drive first, then only consider doing business with you.

3. Park the 50K with your 1st house loan IF the loan is flexi i.e HSBC homesmart, Since you're stretched tight, a buffer will be good.

4. Try negotiating with your wife again to rent out the house. You can split the rental money for your buffer, house and car loan payments.

5. Make sure you have life insurance coverage.

6. Try cutting down on unnecessary expenses to increase cash flow.

7. Don't forget to draft your will too (i mean it in a good way).

Whoa bro.....debt ratio too high....only left 900~1k every month? Sorry for being captain obvious.

Anyway, I have similar thinking with bro Tigerr. Keep your 50k. use it for cash flow purpose. now you have to play the cash flow game. I have an excel that handles my cash flow. not sure if its useful for u.

Debt

*I made some correction. have a look. should be correct now.

This post has been edited by StereoPony: Nov 10 2014, 10:49 PM

Give it to me

thanks 4 yr advice..

house 1 cannot rent out
maybe can rent out the house 2 once ready

i also keen to make a will... haha in case anything happen...maybe will find a suitable time n will do if got promotion.

i already had insurance. nowaday insurance is a must.

if you can rent out house 2, it would be great. but for safety calculation purpose, i'd normally leave out uncertainty things like this. lousy tenants can just lari....kena before.

With that income debt ratio you can declare bankrupt already. Your prize for trying to be smart and cheating Bank Negara with your loan application. Keep the 50k under pillow in case you got sick or fired from your job.

Personal Loan of RM1,815*18months=RM 32,670. Since cumulative interest rate is only 3.13%, you should fork out ~RM 33k from your cash stack of RM50k into FD monthly-auto renewal with interest rate higher than 3.13%, therefore it should be able to cover your personal loan with interest stacked up.

Since the personal loan is settled, your debt ratio should drop to approximately 65% (assuming the house 2 installment of RM2.1k is taken into account of your 90% debt-equity ratio), with free cash of around 3.5k monthly to roll (assuming your salary is approx RM10k nett of SOCSO,EPF,etc), and with the remaining RM17k cash in hand (suggest to put it into FD monthly-auto renewal), should be able to give you a breath, and with an increasing salary, you should be able to hold off without doing a part-time job.

But still, I suggest you to do something with house 1, as it is a major burden. At least rent it out if you're holding it for reason of capital appreciation.

What car are you driving exactly? Is it a new Benz or bmw? If it's just some rm150k and above japanese car then my advice to you is to sell it and get a second hand Benz. The year of the car model should not be before 1995. An e series 1995 model ranges around 30 to 40k plus maintenance after purchasing it should go up to 40k for the car. You still have some image there as you're driving a Benz. The balance of money from the car sold can be rechanneled into fixing your debt of yours.

The reality in life is harsh as you may have now know. From the statement you made, you need to change the people around you. Good salesman are only interested in creating value in others. If he or she judges you only from the car you drive, then they are just interested in making money out of you.

This is probably the hardest to change, you gotta get quality friends that are going to support you through tough times. That's what friends are for. So what if you're not doing well? It's the up and down of going through life.

You gotta act fast and make decision my friend. It's not going to be easy but it's possible. All the best in the future.

TS is asking how to use his 50k cash only.... Obviously he is not in any financial trouble..... So many ppl asking him sell this sell that for what?.......

thanks my new car 140k
prefer new car lower car maintanence,,

i m having the same thought about that.

bigger size... probably high end toyota/honda/inspira.. assuming new...

Refinance hard???? I thought u always says refinance super easy??? undertable or whatsoever mah........

u r absolutely right....i m not in financial trouble. after years of prudent spending...
i just want to maximize my 50k
at the same time try to restructure my debt to create better value for my financial planning

If your 1st house is under full flexi loan or semi flexi loan.. then my suggestion is dump in all the 50k to your first house loan, not as advance payment, but as capital to contra the loan principal. You will be charge 50k less of interest which is better than any FD you can be getting out there.

Current BLR at 6.85, your first hse interest rate is 4.55
if you need emergency cash, full flexi or semi flexi acc can let you cash out your capital.

but if you are taking conventional loan, then is a but risky to do this.

your option to refinance is very slim, because your dsr already burst. Moreover, the difference in the value cannot be stretch for more than 10 years, which is a super big portion in repayment.

Haha!
TS relax only

a very good suggestion
i m also thinking about that now FD 4 %
but bank BLR- 2.3 = 4.55%

where to dump money in

Never go for prepayment for bank. It is a stupid idea because you earn no interest and bank earn your interest while holding your money.

rm600 wor...

house loan 1 semi flexi

house loan 2 full flexi

Yalor.....ask A. Get answer for B. He already mentioned he has strong holding power....n many thinks he is in financial trouble.

that is provided one still have credit left.. those who do not stretch till max, 90%, bank negara only 70%..

the undertable mark up valuation report for refinancing is allowable provided you have credit left..

at the end, both are stretching till max effect, but refinance in this way , you have cash in hand

my few cents

wasting time saja giving advise.

sudah foresee will be in trouble sumore 1st house can not rent, car too new can not sell.. all full of excuses.

if everything also can not, ask advise for what?

Do you foresee in next 6 mths to 1 year you will be out of job ?

If no. Then dump in to either 1 is also ok.. but since house 2 still under dibs scheme.. dump to house 2 will help your developer to save interest. Moreover house 1 (-2.3) interest is higher than hse 2 (-2.4).

House 1 is your best choice.

Change of tone???

Now u kno credit plays a part in taking loan.......

yup rm 600 that why not doing it yet .. i m sure sooner or later will got promotion

thanks.

Trying to find ladder to come down from the stage n want to u turn. But got face problem...

If one do not hav a cool mind and ask a question like this in a open forum will be more headache or crazy only.....

TS is still cool!!

This post has been edited by AppreciativeMan: Nov 10 2014, 11:28 PM

bro actually you wanna left will for some one other than your loved ones? coz no wills still lands back to your love ones, both also need to take court procedure if more than 2 milllion

Last advice, settle the personal loan ASAP and can reduce the burden of rm1815 installment monthly. Keep the balance of rm9k for short time emergency use. Dump the car can save another rm1874. try rent the 2nd house can benefit to reduce burden of monthly house installment. By this way you can reduce cash flow almost rm3600- rm4600 for monthly installment. be remind your house might increase the value time by time and I suggest you can keep your houses at all costs.

TS should spend all 50k for Rolex watch and Hermes bag. Enjoy and relax

50k may be not enough oh......

Don't buy limited edition,enough geh

Yes. Never go for prepayment. You earn nothing.

Better put such money into FD or the highest yield short term deposit.

Tiger suggested to pay for prepayments so no need to worry about future instalments.

This post has been edited by jack2: Nov 11 2014, 09:09 AM

out of topic Q : how long have u been holding from selling your first house?

This post has been edited by syarehey: Nov 11 2014, 09:08 AM

remember that p.loan is quoted on simple interest. 3.13% p.a. effectively is still 5 to 6%

This post has been edited by adele123: Nov 11 2014, 09:44 AM

Actually I think you are doing pretty ok. Don't let people these people scare you. You have 50k in hand and your PL is only 41K. Without that PL, your DSR is only at 65%. Furthermore, once you VP your second house (I assume you gonna rent it out?), your DSR will go to 50-55%.

Just dump your 50K into your flexi home loan and reduce your interest for now.

How much money are you going to have left every month after paying your 4 installments? (Net salary for you and your wife - 4 installments)

What's the reason behind 41K personal loan? Business?

PR-style management.. no money so sell assets lol.

If you want to refinance... here is wad you can do.

since you got 50k in hand and a house..
if you want to get more cash in hand/ refinancing...

You can self rent your first house for 3k or 4k.
just create a tenancy agreement, and stamp it..
then use the money to bank in and reflect the rental.

after 6mth, it will be a good income document to help you boost your borrowing.

Would this be considered legal? Don't want to get into trouble later.

Settle your personal loan first. At least you still have extra Rm1.8k monthly to enjoy your life and less worried.

Your property still can appreciate slowly. But try to rent it out or sell off your property.

This post has been edited by bcteh: Nov 11 2014, 02:59 PM

Is grey area...

90% DSR?? what did you eat everyday bro? don't have money for entertainment la like this..

Ask your wife to help you since she insisted cannot rent out the house. Otherwise you got to sell the house.

You seem confident on your holding potential.

Don't underestimate the potential loss of income though.

Many people overestimate their ability to survive on a monthly income with no buffer, but a loss of income can lead to disastrous results.

Keep that in mind.

If you don't have any kind of liquidity besides the 50k, I would suggest to put that in short term, high liquidity investment product like FD.

If you already have a buffer and the 50k is discretionary, pay down the personal loan first.

loan for fun
coz interest rate low.
the bank officer keep calling me for the loan

thanks, learn a new trick

i come across a will that can transfer the asset to yr love 1 in just 2 week

ya.. thanks for yr analysis. i need to make up a better financial status . coz considering to do business later on. need to improve the credit rating

i took the PL not becoz i need it, i just take it becoz interest rate is low

technically is zero..

wife no issue- not much debt.

thanks for the intelligent discussion.
i had learned alot from u guys
there will be alot of solution to 1 problem. i will now had alot of choices base on yr feedback/suggestion

i will choose 1 which is the best for me at this moment.

thanks

hi what do u meant by that?

from what i read.... TS shud dump the 41k to a HUBLOT

good holding power = talk co** here...

Who mislead you that insurance is a must? But indeed you need if everyday you are eating junk since you will need to visit doctors often.
But if you eat food and do exercise everyday, then you no need to see doctor, thus no need insurance.
To free money up, use your rm50k to settle personal loan, balance to FD. rm17000 can yield some interest every month and you have extra rm1815 to use.
Cancel the insurance policy, another rm600 a month. This rm600 you shall open another account and keep there. Only use for emergency.
Dispose or rent out either of your property

How much is your insurance premium per month? 10% or more of your net income?

car for 1.8k per month, must be benz or BMW or some Porsche , u lived a good life, time to pay your debt boy. =X