Now you are paying all the installments without delays, right? If yes, please take the loan, bank needs your money, I also need people like you in order I can enjoy > 4% of FD interest rate.
I always envy people that can take high loan amount as I'm not entitled to.

This post has been edited by supersound: Apr 6 2016, 12:23 PM

Concur with above reply.

Why do all the thinking and calculations now on what will cost less when the goose is cooked? All the loans are commitments with fixed monthly installments; so why take the loans if you can't keep the commitments and are now trying to find ways to lessen the commitments?

If cannot stand firm, this attempt in reducing the monthly installments (and increasing the loan tenure) will be an ongoing activity.

The loans are agreements with the bank; isn't it a bit too convenient to forget about the bank's help when you need the loans and now trying to lower their business profits?

The only debt that is not a fixed monthly installment is the CC debt - which can be closed at any time. It should also be having the highest interest cost, so clear this first. Bear the pain and pay as much as you can instead of just the minimal every month, and clear it as soon as possible.

If you seriously need another loan to clear it, then do it. But think first whether you can commit and keep to the commitment of another monthly installment.

This post has been edited by j.passing.by: Apr 6 2016, 04:19 PM

Hmm..r u being serious?cause i cant figure it out sarcasm is it :hmm:but on serious note, i do pay my commitment without delay so far as i can remember

This post has been edited by thinkthink: Apr 6 2016, 05:16 PM

Yes sir I am. What I planned was otherwise. I was thinking to use the overlap loan to settle the CC(I might be an idiot to do this, but is it?), maybe some of the PTPTN and personal loan.

You shall know how much interest you are paying for nothing from personal loans and it is very bad on financial management, yet you refuse to learn from mistake but instead looking for people to support your move to retake personal loan again.
Since you refuse to learn from your mistake, then why open a thread and when people are telling you how bad such loan are, you still want to more people to support taking overlap loan are good. So why would I waste time to educate you?

I am obviously not asking for support, am here to get feedback.

Please disregard supersound. He is known to be a bad mannered and self-conceited person with generally unhelpful comments.

Let me help you with approximate calculations based on the limited info you provided:

First off, it's important to note that Simple Interest (used in car loan, PTPTN, and personal loans) is different from Effective Interest Rate (EIR). So we have to convert all of them to their respective effective interest rate.

I used this conversion calculator to do it for you. But I had to approximate some of the parameters (e.g. tenure, interest rate, loan amount) somewhat.

The approximate EIR for each of your existing facilities are as follows from most exp to cheapest:

1) Credit Card
- EIR = 13.5% - 18% p.a. (depends on your repayment history)
2) Existing Personal Loan
- EIR = 8.71% p.a. (I used RM90k, 15yrs, 5.3% to calculate)
3) Car Loan
- EIR = 6%-8% p.a. (I used RM80k, 9 yrs, 3.4% to calculate)
4) Housing Loan
- EIR = 4.3%-5% p.a. (based on current market rates)
5) PTPTN
- EIR = 2%-5% p.a (depends on your repayment scheme)

As for your new offers:
Option 1 - EIR = 6.29% p.a. (RM160k @3.5% for 10 years)
Option 2 - EIR = 6.19% p.a. (RM125k @3.44% for 10 years)

At this point, it is obvious that the new P Loan offers are only cheaper than your credit card and existing P.Loan (maybe a small chance your car loan too), but more expensive than your Housing Loan and PTPTN.

However, you must know that there is some price to pay for early termination of a Car Loan and a P.Loan, which will likely not make it worthwhile to pay off these 2 loans early (Read: Rule of 78)

Hence, if for those offers, I would recommend to borrow only just enough to clear off your credit card debts and nothing more.

That way, you will come out ahead.

This post has been edited by METALRAGE: Apr 6 2016, 08:54 PM

Just by reading this statement already can tell you know nuts on settling loan early.
Indeed there's "penalty" on settling a loan early, but there's still savings.

Of course there are. But how about you do the math for TS case and tell me if it ends up being worth while to take up the new loan to settle the car loan and existing ploan early? Which is what he is asking.

I rest my case.

Thanks for ur detailed response, highly appreciate it. I would say me as I think most Malaysian, are not literate on this kind of thing. What i care the most is affordable monthly comitment, not knowing that ill be paying almost 35% extra for full tenure due to interest.

Your suggestion i will take into serious consideration

With his guide, that's why now Malaysian are at 89.1% debt/GDP, highest population in Asia that having debts over income as a third world country

do the debt consolidation only if the interest rate on this is overall lower than the ones you are having, if they are - then owing 1 bank is better than owing 5 other banks

consolidate it and like one said - only take enough to cover the loan amount, the unecessary cash is not worth it, unless u wanna take that and cover your car loan as well, but for that you are still short of 30k

at 29 now, i would assum eyou were maybe 27 or 28 when you took that 980k personal loan, thats really alot for that age

Basically Malaysian prefer to make debt rather than savings first
If were to settle bad debts(Personal, car and credit card loan), better borrow from family members.
Taking 1 loan to cover another are stupid idea to begin with, unless the effective interest rate are 50% cheaper than any of the bank's saving accounts interest rate. If the savings account interest rate are 2% PA, the new loan's EIR shall be 1% max. Remember, old loan you already pay interest and retake another loan you are paying new interest again.

You must be a special kind of thick.

Paragon of the saying "You cannot add to a cup that is already full".

Roflmao

Somewhat agrees with you; generally, financial savviness is rubbed off from immediate family members and close friends, and if it is not found within this closed circle of relatives and friends, it is easier said than done "better borrow from family members" as all could be in the same boat.

The damaged was already done once the loans was signed, as the bulk of installment payments in the first several months/years was for interest payment. So how much would one really saves by using a loan of lower interest to replace another loan? I doubt there would be hardly any difference, especially if the installment is lower than the previous installment such that the tenure would be longer.

7-9 years car loan. Damage already done. Convert the flat rate interest to effective rate to know the true cost of interest. Read the rule of 78 on how much is the outstanding balance if to fully pay and terminate the loan. Basically, would only end the loan immediately if a cart load of money suddenly dropped onto my lap.

Same with personal loans with flat rate interest. Unless of course there is a guardian angel who can provide help with very low or no interest.

As for housing loans, damage already done when the longest possible tenure of 30 or 35 years was signed. Why the longest possible tenure? To have the highest possible loan amount with the lowest possible installment. Again, the bulk of the interest cost is in the first several years; the lowest possible installment would hardly cover the monthly interest.

Ideally, it should have been paying the highest possible installment when taking any loans. Not the lowest possible.

Consolidation of loans. This is only applicable if there are 2 or more credit card debts, where the outstanding balance of the higher interest card is transfer to the other card.

I doubt it would be applicable to consolidating several personal loans by getting another new loan. It could be merely for the sake of convenience of paying one installment instead of several times a month. It could be worse if this one big loan is defaulted; while previously there was an option to delay payments on the loan with the lowest interest when there is inadequate money to pay all of them.

=============

Above is out of topic, no reference to TS situation... my 2 cents on TS situation still remains as in previous post... tighten belt, bear the pain and continue on with the existing loans instead of thinking too much. It's only about half of his income.

Practice makes perfect. To live within our incomes need practice too; and it is better to start immediately without any further prograstination. Once the cc and personal debts are ended one by one, and if the changes in budgeting practice still remains, the 'installments' would continue on as 'savings'.

This post has been edited by j.passing.by: Apr 7 2016, 07:07 PM

Well, this is the best you can do? Can't find any reason already then continue with personal attacks. What a loser.

For me I'll still settle the shortest loan first as it can ease up my budget.
Still preventing taking bad debt loan in the first place are important.
For 7 years car loan, if you settle it earlier say 5 years, you still have 1-2 years of savings. I know this as i just settled my car loan recently, just because of I settle it on 13th month from a 5 years loan, I only get 3 years of savings as the bloody interest are charged upfront.
That's why I once again has no loan to serve, I know how to set target and spend by my means

Thanks for the lenghty response, really appreaciate it and i will definitely consider it. Taking another loan to overlap my existing one had never been in my mind. But after I was offered by several banks now it made me thinkng.

Today, the banker call again and said will try to arrange the lowest possible rate. For now the offer stand at rm160k/125k for 10 years at 3.9% interest.

For all I know, a loan is not free money, tho it settle my previous loans, it doesnt made me loan-free. Total commitment might be lower 10-20% per month, but the loan period tho which i think i have to think a lot whether or not i should commit.

By lowering monthly commitment, the extra money I could use for something else? I think?

This post has been edited by thinkthink: Apr 7 2016, 11:07 PM

I advocate financial prudence as a way of life.

But financial prudence =/= financial literacy. There are inaccuracies in your post i have to point out for the benefit of other forumers so tht such inaccurate understanding doesn't perpetuate.

Your views on early settlement of certain loans are correct. In that it may/may not not be the optimal thing to settle early because of how interest is appropriated over the lifespan of the loan unfairly. So a calculation at the point of settlement is necessary to find out.

But this is not the same for housing loans and credit card debt. Any point at which you decide to settle completely, you will not have paid a single cent more in interest than was as per the stated interest rate.

In plain english, if you settle your house loan or credit card early, your potential savings = the stated interest rate.

But if you settle your personal loan early, the calculation for potential savings is less straightforward. Though it isn't that difficult either.