There's nothing not to trust. Just read through t&c on how to get the promo rate. Need to use fpx to transfer.

Since you are newbie,

For personal loan and hire purchase, bank quote you interest rate, known as flat interest rate or academically known as simple interest rate. For housing loan, bank quote you interest rate known as effective interest rate (EIR) or sometimes I see being described as effective annual rate (EAR). For this purpose, I call it effective rate. EIR is the actual rate applied to you. You use this to compare to your returns from FD.

The analogy is like saying something is 3 feet long and 1 metre long. You must convert them into same ‘unit’ to know which is longer (or shorter). Similarly. Your must convert the flat interest rate into EIR to compare.

So for 3.99% p.a. for 1 year, the EIR is actually 7.29% p.a. So this is actually obviously higher than your FD. So no, please don’t take the personal loan to place in FD.

As for the maths behind it, I think we skip it for now. Yes, no doubt the interest is still just RM399 per year, but the maths will tell you the rate you are being charged is 7.29%. reason being bank should charge you lesser interest as you pay off your loan, but it doesn’t happen in this case. So for now, ignore the maths, know the difference. Use calculators provided (use the link I have given). We are not in the age where we calculate on our own.

https://loanstreet.com.my/calculator/flat-t...rest-calculator

hello, please do not misled others. read my comments above.

FPX is just another method of payment/transfer. nothing fishy about it. I believe, HLB is doing it to ensure fresh fund, although i still think easily manipulated.

It's just that you are not familiar with FPX. FYI, GIRO and instant is also under BNM.

This post has been edited by adele123: Sep 15 2016, 09:37 AM

You can read this article by loanstreetRead this

The simple way is really to know that bank quote interest in flat rate for hire purchase and personal loan.

Effective rate is for housing loan. In simple way of explaining, your savings acct/fixed deposit is also quoted in effective rate.

Difference of flat rate vs effective rate.

1) For flat rate it means that interest is charged on the entire principal. Simple example, 1 year loan, RM100,000 at 5%.

Interest = 5000
Loan = 100000
Total to be paid = 105000
Monthly instalment = 105000/12=8750 per month.

2) The calculation for effective rate is more mathematical and complicated but the intuition is that, everytime i pay my instalment. thankfully we can just use calculators provided.

https://loanstreet.com.my/calculator/home-l...duty-calculator

Using their calculator. RM100,000 loan, 100% financing, 5% interest, 1 year.

Monthly instalment: RM8,560.75
Interest = RM2728.98
Loan = RM100000

Total to be paid = RM102728.98

SO another way of thinking is, when i borrow money from bank, and when i pay them back every month, i reduce the interest charge to me. because the money i owe them is lesser. This is the case for housing loan.

For car loan, it's not. So that's why the difference is there.

The tuesday promo is extended. It's online. 4.15% over 6 months. Nothing to do with counter.