One eg is the bank offer only 80% when borrower applied for 90%.

The other eg is required borrower to provide a guarantor

Etc....etc....etc.

This post has been edited by mini orchard: Feb 23 2022, 06:18 AM

And some can say online calculators are not 100% correct !

Whether the loan process is inmaterial. That is procedure.

Generally no bank can force a borrower to accept the loan offer ... this is legal !

In a SnP, no buyer seller can force to sign the agreement if one dont agree to the terms. Deposit paid will be refunded.

This post has been edited by mini orchard: Feb 23 2022, 01:25 PM

None.

No bank tnc are the same. Sure have variations. Otherwise why do borrowers compare and borrowing is NOT always about interest rates

It depends on the borrower needs.

Choose the one that suits borrower among the better.

For eg, if UOB tnc suits you, then is better. PBB may suit other borrowers.

This post has been edited by mini orchard: Feb 25 2022, 04:36 PM

Sometime borrowing decision is not difficult to decide if borrower knows what he wants, otherwise every offer is complicated.

Even if a wrong decision was made today, borrower can refinance to be in better position for the future.

Who knows, one day in the future, the bank may pay customers incentive for monthly instalment paid similar to CC cash back now which is unheard 20 years ago.

This post has been edited by mini orchard: Feb 26 2022, 08:49 AM

Refinancing is the same as buying another property. Is only now that buyer and seller is the same person and there is no SnP.

If your loan is flexi or semi, you dont have to refinance. Banks allow wirthdrawal of repayment subject to tnc.

Refinance also depends on how much cash you need. Any refinancing amount will goes towards settling the outstanding loan first and the balance given to you.

Refinancing will incurred legal fees, stamp duty, valuation fee and mrta. If the price of your property doesnt appreciate in market value after valuation, or if repayment is only for few years, refinancing dont benefit you even though your intention is to get lower interest rate.

The new tenure is also shorter because of age factor and new monthly repayment can be higher subject loan amount.

Refinancing approval also depends on your repayment history.

You have to call the bank to check how you can redraw.

For 5 years, the reduction in capital repayment is low. In a startup repayment, about 60 to 65% of monthly repayment goes to interest and the balance reducing principal.

For every 1000, 400 is to reduce principal and 600 to interest.

After 5 years, principal reduce by 24k and interest paid is 36k.

The next question is what is the market value of the property at 5th year ?

If is lower than outstanding bank loan, then you have to settle the difference during refinancing. Meaning, you wont get more money out from refinancing.but instead have to pay bank to refinance the shortfall.

Again, the next question ... do you have the cash to settle the difference ?

If you have bought the property with rebates and cashback and no down payment, more likely the value will drop below bank loan outstanding during refinancing.

In theory, is better to refinance if interest is lower but again interest rate is not only the deciding factor.

Are you prepare to pay cost of refinancing, accept a lower refinancing amount and maintain the same monthly repayment amount because of shorter loan tenure ?

Again, your interest should reduce accordingly in tandem with current rate but of course not lower than current new loan rate.

Previously my monthly repayment was 2.3k but today is 1.96k because of overall lower rate.

This post has been edited by mini orchard: Mar 4 2022, 10:36 AM

I cant be sure as I never do b4. But I think will have a separate account number and do repayment separately.

Pls check with your bank.

Generally, everyone should be able to get a loan if he is not blacklisted by a financial institution.

The next question is how much can you allocated you monthly 'salary' for the loan. Then only you will roughly know how much you can borrow and what property price range you can buy.

When you submit your loan application, bank will assess your eligibility based on other outstanding loans ... HP, PTPTN, CC and PL. If none than is straight forward.

In addition, the bank will also consider the market value of the property. If you buy at 500k, and if the bank valuer says is only 460k, then the loan is based on 460k.

For first time loan borrower, he can get max 90% of value or lower if you doesnt qualified for 90%.

So you have to topup the difference with your savings if property value is lower and loan is less than 90%

If you want lower than 90, you pay more downpayment and monthly repayment will be lower.

Monthly repayment amount also depends on age. An older borrower will pay a higher monthly repayment.

Once everything is confirm, the bank will issue an offer letter with the terms. Is non negotiable .... either you accept or reject.

There will be other cost when one purchase a property ..... legal fees, stamp duties, valuation fees (if subsale) and mrta (life insurance for the loan). Remember to allocate some money for that. .... about 5% of purchase price plus the minimum 10% downpayment.

Once you take over the property, you will require some money to reno and furnish the place. There is no limit on how much you want spend. Bear in mind that what you spend doesnt mean you will get back when you sell later.

Since your income is from the sole prop business, make sure all your financial records and tax payment are in order for the bank to review. Having a monthly epf contributions helps....not pay one or two lump sum in one year.

Finally, buy within affordability. The bank can loan you money and they can also auction your property if you dont pay your loan.

TA, bank statements and rental tax declaration.

Up to the bank to assess the risk.....it can reject or partial. Unlikely full.

All loan approval is based on income and not savings balance.

Is your current income able to sustain two loans repayment ?

Based on nett taxable figure. After paying all expenses, will the balance enough to cover loan repayment.

The declared figure is deemed that tax payer has deducted all allowable expenses to arrive at a lower taxable income.

For example...

Yearly rental is 24000 (2k per month)

Expenses is 15000 pa including loan interest.

Effectively, nett taxable rental income is 9000 ÷ 12 = 750 pm or 37.5% of gross rental.

This post has been edited by mini orchard: Mar 7 2022, 10:51 AM

Bank will loan 90% or lower based on market value and or borrower profile. How borrower settle the difference, whether is 10, 15 or whatever figure is up to the borrower.

Interest rate is based on many criterias ..... loan amount, tenure, property, bank risk, etc.

This post has been edited by mini orchard: Mar 7 2022, 10:31 AM

What is your purpose to refinance using your sistet's name ?

Whether bank charge 0 or 3 is not important. They can package it to make it looks 0.

At the end, every bank wants good returns on a loan.

As example, banks charge lower rates if borrower include mrta in their loan and vice versa.

You can cont with the loan after leaving the country for short or long term.

Create a Standing Instruction to repay the monthly mortgage. Make sure you have sufficient fund only.

At the same time, request a lawyer to do a Power of Attorney (PA) in your sister's name to act on the matter or on all other matters while you are away.

I believed the 3% is for legal fees, stamp duty and other related cost in any refinancing.

In addition, I think the bank would require you to sign a personal guarantee and also other letters to allow them to auction the property in the event of a default.

Remember that any loan under a 3rd party name will reduce her eligibilty if she wants to take her own loan later. Is of no benefit to her unless she has totally no intention to take further loan.

In addition, if there is a default no matter whose fault, her name will be blacklisted from any future loan application.

This post has been edited by mini orchard: Mar 9 2022, 09:17 AM

Mrta

Check your premium here .....

https://www.etiqa.com.my/getonline/calculator-mrta-ltfi

This post has been edited by mini orchard: Mar 11 2022, 02:48 PM

If you have not sign the loan agreement, I suggest you check with other banks.

Nothing to worry as long you can prove the money trial.

Money from the sale will goes to the seller. Thereafter the seller decides what to do with the money.

Epf, bank statements, yearly financial statements, tax submission and guarantor.