i was wondering on this scenario.

some bank are slow to reduce their BR during the reduction of OPR in 2020.

Some reduction of BR is not in tandem of OPR reduction, for eg OPR reduce 0.5, BR reduced by less than that.

and even OPR at a low of 1.75%, some of their BR are still quite high.

now as OPR eventually increase to, say 3%.

will it cause the total effective interest (BR+Spread) to be higher for housing loan applicants taking loan during
OPR 1.75% or OPR 3% before 2020?

Ya..

i was wondering on the spread.

will the bank increase the spread during their loan offerings when the BR is low, and lowers the spread while the BR is high or vise versa?

if it is so, as BR normalize there will be difference in total interest (BR + Spread)

This post has been edited by sjz: May 14 2022, 09:10 AM

Back in 2016 i was offered housing loan under affin BR + 0.76 ( Loan Value : RM 250k)

Last month, Affin offered for another loan at BR + 0.2. (Loan Value : RM 500k)


so for this case shared by forumer, means the spread difference is caused by loan amount?

regardless of BR, the spread in fact not changed as much?

current loan with PBB is 4.15% p.a.
600k loan.

previously when taken loan is 2.9% p.a which is relatively good deal that time,
but due to OPR increasing, its 4.15% p.a. now.

can we nego with the same bank to give a better rate?
or any other way to reduce the interest seeing the rate going now is around 3.8 to 3.9% p.a. ish

for my case 4.15%, vs 3.9%.
interest diff 0.25% pa.

come out to around RM125 /month diff assuming max loan amount 600k.

seem not worth looking at paying such huge amount to switch bank.

and those zero cost switching seem to yield a higher interest rate, not much diff then current 4.15%.

looking at cases of some forumer shared 4.22% p.a.
seem like its not that worth to take loan during low OPR compared to high OPR as the spread is higher during low OPR

This post has been edited by sjz: Nov 19 2023, 09:00 AM

i don't think this is the correct strategy.
why put all liquid cash into the house for own stay?
you can't simply get that amount of money out.

imho, house for own stay is a liability and not asset.

the better way should be take max loan with semi-flexi (best is below 700k-ish looking at max 3k disposable income) since TS is having a fixed income,
go for full-flexi will be a waste as this will incur some monthly charges.

park all excess fund into the semi-flexi loan to offset interest.

in this way, TS will still hav access to the funds in case of need.

the monthly instalment could be higher in this way,
but if you park enough funds to offset interest, majority of the monthly instalment shall be used to pay the principal and not the interest.

This post has been edited by sjz: Apr 4 2024, 09:27 AM

well said

often some older generations ppl can't figure out this correctly.

they save every penny and live miserably.
eventually when the time comes, we can't bring any cent with us anyway

what is the average or best rate for ZERO cost moving?
loan amt 550k.

This post has been edited by sjz: Aug 19 2024, 09:48 AM