Yes It can be done. No bank will stop you from buying it.

Put it this way,

Market value is Rm500,000
Oustanding loan is Rm300k

If you are eligible or 90% margin of finance.

Amount to cash out will be

Rm500,000 x 0.9= Rm450,000

Rm450,000- Rm300,000= Rm150,000

You will be able to cash out Rm150,000.

The rate lowest for this will be
Around 4.4% - 4.45%

Keep in mind.
1. If you just opt for lower interest rate, a lesser 0.5% doesn't help much, because you will need to pay for legal cost and loan stamping fees.
2. If you are opting for cash out, do take in the Cash out amount - Total legal and stamp cost.

Your legal, valuation and stamp duty cost would be around Rm5000-Rm7000

Whether you should buy MRTA or MLTA is based on your own self preference.

For MRTA

a) very Cheap premium
b) usually buy MRTA coverage depends on how long you want it to be.
c) the protection will reduce with time. protection for RM500K PROPERTY
year 1 Rm495k
year 10 Rm180k
year 13 Rm50k

but the Loan oustanding definitely will plummet as years comes by, because your installment paid will reduce the loan oustanding.

In the end, the MRTA protection will be less than Loan oustanding owed.

d) If death happen to the owner. The transfer of name will take a longer time, usually 1-2 years. Worst come worst 3-4 years as I have seen of. In the mean time of name transfering, the void period of 1-2 years, the family of the deceased person will have to bear the installment, if unable to do so, the property will be auctioned.
e) Any refinance, MRTA will deactivated

MLTA

a) Pay more for the premium
b) Protection Cover for Rm500k property
year 1 RM500k
year 15 Rm500k
year 35 Rm500k
c) Refinance are allowed and won't deactivate the protection
d) Transferable to other property
e) cash value

Attachaed a comparison, brief summary, sorry for the terrible writing.




There's nothing as allowed or not allowed, we have free right!! haha, it depends if your law firm is the panel lawyer for the bank you are being financed. Ask your firms tauke is the law firm panel for the subsequent bank. If your lawyer firm is on of the panel, you can proceed with it.




The range of rate for HLB would be around 4.45%-4.5% and maybank is around 4.6-4.65%

This post has been edited by Madgeniusfigo: Sep 11 2015, 05:33 PM

What are they thinking, seriously zeti.. seriously.

With such a weak economy, raising the interest rate to 3.75% still plausible. We need higher interest rate to lure more FDI into the country.

Export on the other hand with low currency, doesn't increase much, so with increase of interest rate won't affect much on exportation sector.

MALAYSIA Economy is looming into darkness.

This post has been edited by Madgeniusfigo: Sep 11 2015, 06:56 PM

Based on your current info, mortgage calculation out, you are eligible for the loan amount RM270K.


Lowest rate for this loan amount will be 4.45%

Yes it will offset as it tied to the loan account.

The difference between full flexi and semi flexi
Take note*(This is just example of a bank, different bank has different modus operandi)


Full flexi:

1) current account tied to loan account
2) auto debit from current account at month end and interest is calculated based on outstanding balance minus amount in current account
3) maintenance charge of RM10 per month
4) setup/ processing fee of Rm200
5)The liquidity comes in the form of an ATM card or a linked CASA account to the housing loan.
Example: You have a shop that is opened Monday to Satuday, rest on Sunday. On Saturday, you deposit all your proceeds of the week into the flexi account, on Sunday, you would save [(your-HL-interest-rate)/365]*AmountDeposited worth of interest. On Monday, you withdraw the money to run your business

Semi Flexi

semi flexi package typically has these features:
1) requires you to phone in to indicate the extra payment as early settlement of advance payments
2) if you fail to indicate, you will be charged 1% (some banks do this afaik)
3) if you indicate advance payment, no additional interest is saved as "advance" payment will only be credited to your loan account when it reaches your cycle date, so it is plain advance payments. and must be in multiple of your monthly payment.
4) For redrawable prepayments, you need to indicate separately and Redraw charge of RM50 is imposed (M*B charge Rm25)

This post has been edited by Madgeniusfigo: Sep 11 2015, 11:56 PM

No problem, glad that I could lighten up your thoughts and burden.

Hmm, I hope the market correct itself sooner or later.
Yea, you have your point too though. It's actually a double edge sword.

Lets' just hope we are not into abysmal walk.

Not a Sifu but let me share few cents regarding this.

If you study the history of nation, history are a looping cycle, it happens again and again.

Economy downfall, FDI plummet, currency plummet, Debt cost increase, Fed print excessive $ to pay off debt and civil servants, interest rate hike, economy recorrect itself, nation economy stabilize, Prosper, and the cycle loop back.

All this are self serving prophecy, because we are in a system called "FIAT CURRENCY. So there isn't any stopping to this vicious cycle happening everywhere. It's either die or follow the rule of the game.

With our current economy, things seems bleak and multiple blunder policy has brought nation to its peril. I can foresee a interest rate hike sooner or later, it really depends on how Malaysia CENTRAL Bank playing its role. As I mention, increasing interest rate is a double edge sword, which will burden the nation but will help the nations economy to correct it self. Too many funky money going round the economy when interest are low, people speculate with ease.

You can see the statistic of foreign xchange reserve are plummeting as a buoyancy of the drop. Interest hike might come next, but we will see, we will see.

All this contributed to increasing inflation in our own motherland.

a) Holding on to your RM cash in saving bank is definitely not the way. Do due diligence and search for property that come with good value outlook, location geographically, surrounding booster.. etc. Investing in valued property definitely is one of the way. As we know, property price surge when inflation kicks in.

b) You are talking about leverage. Leverage is an amazing tool, but it's also a double edged sword. Leverage could increase your profit double fold or hammer your with ten fold of deficit loss. Using this tool responsibly will be the best. If you are risk averse like me, I will take on moderate leverage and 90% loan every time if possible. Because of inflation, the money we are paying now worth more than the future money. Moreover, OPM, I am using other people's money to invest in property and my cash for another investment. Leverage is the game for "FIAT CURRENCY"system. We can't deny it.

c) For islamic loan Musyarakah mutanaqisah is "almost" similar to conventional loan, just that slight deviation from the concept and modus operandi. It doesn't differ much. Except in 25 years time, islamic loan boom and comes with varied good perk. haha..

d) Fixed rate, if you are risk averse and the rate for fixed and conventional doesn't differ too much. Do take fixed rate. I didn't say it is the best choice but at least it give serene and piece to your mind

*Above is just my 5 cent and not a guide. All the above is subjective and debatable*

c) I am just making an example when it happens in the future. Doesn't mean it is 25 years. My bad for the confusion.

Z

This post has been edited by Madgeniusfigo: Sep 17 2015, 06:24 AM

Different bank will have different premium calculated

If you want to reduce the premium, go for 50% A 50% B. But this is risky, when any one of the party falls into accident, the insured amount given will be 50% of the loan insured amount.

MRTA, it will take years before the amount protected could be received. (Do contact your bank for verification on this)
But I am confidence it takes year for you to receive the 50%.

But if you want guarantee protection, then make it a 100% A and 100% B. It really depends on your risk appetite.

Dear Nick,

To better calculate your total max loan amount entitlement. To be accurate, we need following details:

1. Income (borrower)
- net salary
-OT
-Allowance
-Bonus

2. Supporting income (borrower)
-Tenancy agreement
-ASB ( 2 years total bonus)
-Shares
-Fixed deposit

3. Debt / commitment (borrower)
-Hire purchase loan (Purchased amount)*
-Housing loan (Outstanding amount)
-Personal loan (Credit limit)
-PTPTN (Oustanding)
-credit card (outstanding)/(epp?)
-ASB loan ( total oustanding amount)
- Overdraft ( Credit limit)

Anyway, based on rough figure you provided, I had generated loan analysis on your entitlement. Look at right bottom table section. 5 banks shows you could get below 1 mil property




Bank wouldn't look at this. This is just a financial planning for yourself. Atleast you will have a rough figure how the property monthly installment you could afford. Plan ahead, wise 10 years.

This post has been edited by Madgeniusfigo: Sep 17 2015, 08:47 PM

Yes, it is advisable, if you are able to afford the premium. As you aged, the mlta premium will increased exponentially. If the premium quoted are reasonable to your financial health, why not?
As I have listed all the pros and Cons between this 2 assurance at somewhere above this post.




For MLTA protection, you can get exact protection of the outstanding loan amount, given that you are able to pay the premium. For RM680,000 loan, after 8 years, your loan is RM400,000, you can only purchased protection exact loan amount and 20years tenure. So that if anything happen, you are being insured of RM400,000 during death or permanent disability.

Your premium for RM480,000 insured will depends on (age, amount insured, your health,.....) The older you gets, the higher amount insured will directly increase the premium amount.



The answer is YES. It's called mortgage LIFE term assurance. Life as in your life, it won't end when you sold of the property, so it is transferable.

Conclusion:

What to chose depends on what's your objectives

You can opt for MRTA

1. If you are tight in budget
2. Wish to reduce mortgage interest rate by pairing mrta with the loan (some allows)
3. Cash rich, knowing that your family has extended cash amount to cover the remaining installment or settle the loan when something happen to main borrower.
4. short term investment on this property, flipping in near 5 years future time being

You can opt for MLTA

1. If you want a comprehensive protection
2. an assurance of an amount to cover future outstanding amount.
3. Having family with kids.

This post has been edited by Madgeniusfigo: Sep 17 2015, 09:02 PM

Dear fool1988,

just to clarify your details and to present you with a more accurate answer and solutions. I have inquiry regarding your problems.



How many banks had you applied?
and How long has it been?



Singapore dollar you are earning right?

1.Hoousing loan, How much O/S you still owing the bank?

2. PTPTN, how much O/S you owe bank?

3. How much credit card Outstanding you owed the bank?

4. Anymore PERSONAL LOAN? Hire purchase LOAN? OVERDRAFT?


This will shown in CTOS record.



Your debt in CCRISS doesn't mean it is bad, every debt will be inside ccriss.

Given that you have settled your loan with a proper settlement letter and a valid reason, bank will approved the loan, but if your payment record is really really bad (will slash margin).

If you are affected by CTOS, there's a way to get around it, "legally". haha

Anyway, Your problem is quite common, solution and ways can be given.

Dear Phengeon,

His loan acceptance rate is very weak.

1. No EPF
2. Didn't pay income tax
3. Does he really has no any commitments and debts?
-----------------------------------------------------------------------------------------------------------------------------------

Alot of bank wouldn't finance your loan if it is without EPF. Hence, EPF contributions could be a must have but also could be optionable. Based on which bank.

Your advise to him is great, paying tax advise is the best of all though. Credit for you for giving great advise

There's certain bank with easy entrance that would accept this loan with just payslips and bank statement but no guarantee in this. Moreover, he has no commitments, this will reduce the chances of getting the loan. If he is approved of the loan, his margin of finance will be slashed badly downwards less than 70% or 60%.

Anyway, this looks very weak but doesn't mean there isn't any silver lightning for this case.

This post has been edited by Madgeniusfigo: Sep 19 2015, 09:50 AM

There's unconventional way you can do it.

1. SET up sole proprietor company and register it under SSM
2. Open a current account for your company
3. register KWSP
4. Register yourself as employee of the company and pay 11% and 13% into your kwsp
5. pay your self a fixed income and credit it consistently every month into your bank account.
6. 3 months payslips, epf and bank statement.

your epf will show 3 months of cash credited, bank will query, hence depends on how you plot the story.

I am not guiding you to do this but just some suggestions.
*Just a suggestion, risk will fully bound by you*

But anyway, I will recommend you to Pay income tax, this is the best method of all. You make the government happy, the gov will not interrupt you. Fair game.

Top up is allowed, for MLTA.

MLTA is insurance provided by bank. It comes with all kind of regulations.

First of all, when you top up another rm500k, you will actually be purchasing another policy for that rm500k.

1. You can only insured the total outstanding amount stated. Bank doesn't allowed you to insured more than that, if not, BNM will question them.

2. Let me clarify, MLTA (TERM) isn't attached to the people but the loan it self. Anyway, it is still transferable.

3. You can only insured max tenured according to your loan tenure of the loan.

4.Yes, MLTA policy will show up which property you bought and cover, because it is attached to your loan.

mortgage life "TERM" assurance

If you purchase form insurance agent, it is different MLTA product.

As I was explaining was for MLTA insurance by the bank itself.

If you purchase from insurance agent, the MLTA/MLA will be different.

Do note*

Dear must8

For comission based salary

The calculation for bank is different, they will need to average total 6 months of your salary.

May I know
Month of 8 ,7 ,6 ,5 ,4 ,3, commission salary?

1. Car purchase loan borrowed is how much?
2. What's your Rm900 installment housing loan outstanding amount owed to the bank?