Here is the processes ya:

Application - Approved, LO issued - LO signed/accepted - Sent signed-LO to the bank - Bank accepts, issue Letter of Isntructions (LI, along with original LO) to law firm (and instructions to valuer) - law firm applies for consent from land office (if needed) - law firm drafts the Loan Agreement (LA) - have you come over for LA signing - send the LA and LO for stamping - send the stamped documents to bank for execution - bank accepts the documents and execute the loan - bank asks how much is the settlement amount for the previous loan - law firm sends the settlement amount request to previous bank - previous bank sends letter to the law firm lettering them know the settlement amount - the law firm sends letter called the Advise to Release telling the bank the settlement amount - bank releases 1st payment, called the 1st draw down - paid to law firm - law firm pays to previous bank - previous bank sends letter to law firm acknowledging the payment - law firm sends another Advice to Release to bank to release the remaining money - bank releases the cash out...

I hope I didnt miss anything

Anyhow, the reason i wrote all that is to illustrate the pathway of communications in the transaction. It may not be the most efficient but that is how it is....

so to answer your question, which process consumes too much time? Well all of them... any party that doesn't play ball delays the process as a whole.

Thanks for the insights. For the consent from land office, how long it normally takes? My sister currently refinancing her house and her process basically as follows:

1. sign LO
2. sign LA on 11/5/17
3. valuer visit house 18/5/17
4. previous bank issue redemption statement for 3 months
5. sign amended LO - valuer increase house value
6. now waiting consent to charge from land office

So looks like still lot to be done i guess? She's quite sceptical on the 2-3 months process since i told her from the blog i read usually more than 6 months. If 2-3 months I also want to refinance later

You need to factor in public holidays as well. Most of the time the delay is between the banks on the redemption and also on the respond of the lawyer in doing the paperwork as soon as possible

But that you need not to worry as normally the lawyer will have a deadline to meet to insure it keep up with the bank KPI

i have been looking around for HP alternative, 1 of it was refinancing my fully paid house and to buy the car in cash to reduce overall interest bank charging me.

but it seems like recently i found out that rhb and cimb are offering flexi HP for car which did exactly what you mean, the interest isnt fix and is calculated base on how much amount it left in your total amount.

do you think is still a good method to refinance the house for it?

the rates offered i still not sure la

Hmm I wouldn't do that if I were you because Refinancing involves loan agreement fee which might end up paying more than you take the hire purchase loan alone.

But it's good to know that hire purchase facility are being offered like OD facility

this is what i'm afraid of

if there is agreement fees or need to go thru lawyer smth...it just kills the idea of paying less

while bank are coming up something like i mention deduct from principal amount HP for cars.

1. The valuer did his job quickly; but their part is easy, they come, visually inspect the house, write a report, get paid, release the report to the bank and send you a copy. Their job ends there.

2. Now the delayed part in your case is most likely gettin the consent of charge, but that is really beyond your and the lawyers' power. Some lawyers claim that they can "bypass" the process with "money", but that is outside the book and I will not comment on that.

3. Since this is not a purchase, the delay caused by the consent of charge may matter, but not too much since there is no vendor-party waiting for your money.. its is only your money that is being delayed

The problem with consent is that because you are dealing with government offices, and they may be understaffed, and/or their performance don't affect their bottom line, so there may be some slack there.

4. 2-3 months is doable, especially if the property is freehold, or not encumbered (free of any charges from banks) and/or the bank that releases the redemption letter does not take too much time out of that

At this point you may realize that due to the multiple parties involved in the process, any of them delaying their work will affect the rest of the processes. The lawyers job is to help you with everything, but sometimes the lawyer is the one that is slow hahahaha

1. Oh yes, banks nowadays are being encouraged to offer reducing balance loans... even personal loans are being slowly introduced to the reducing balance calculations.. however they are being advertised as simple interest loans... for example, a Bank Islam personal loan is being advertised at 3.89% flat-rate for 10 year repayment... but if you look at the LO, it is actually being calculated at 6.2% per annum (p.a., meaning it is a reducing balance loan)... which is GOOD, that's the best practice for loans...

but why advertise it as 3.89% flat? well they are not being dishonest, that is exactly the rate and installment you pay if you compare the rate to other fixed-rate loans... and they need to compete against other banks that are still using fixed-rate... so if Bank Rakyat advertise their fixed rate loans at 4.0%, and BIMB advertise their at 6.2% p.a. (3.89% fixed/flat rate), then BIMB would lose out eventhough their offer is much better than Bank Rakyat's

2. On to your second question, refinancing your properties would cost you about 1-2% of the house value due to the associated moving costs - valuation, legal fees, stamp duty, these can be financed into the loan but they are still costs that you have to pay one way or another. I can't really compare the options that you have without really knowing the MV of the house as well the price of the car that you are buying...

take it this way, if you are buying a BMW... RM200k loan... rate is 2.5%... for 7 years, the efective interest rate p.a is 4.69%... while refinancing can net you a rate of 4.35%, will the difference of 0.35% p.a for 7 years cover the cost of refinancing? errmmm... maybe provide me the numbers and we can learn together. What car are you getting, how much are the cars...

btw, for the reducing balance loans offeredby the banks for car purchase... what are the rates like? im not into cars so Im not in the market for their loans hahahaha

yes, but the answer should be beyond gut-feeling, there are calculations that one can perform to decide financial matters.

Also, i think you are confusing OD facilities with reducing balance term loans.. with OD you dont have to pay the principle balance, you just serve the interests till you die or bank withdraws the facility. With reducing balance term loans, customers still need to pay the installments which are divided into 2 portions, the capital repayment AND the interests/profit... the capital repayment will zerorize the outstanding loan you have with the bank. While the insterests/profit are the banks' profit for providing you the facility, no different to installments for mortgages (property loans)...

If you want to learn more about mortgages, you can ask about them here in the these thread below, I help forummers and non-forummers alike all the time there for close to a decade...

https://forum.lowyat.net/topic/2759418?author=wild_card_my
https://forum.lowyat.net/topic/3437581?author=wild_card_my

Faiz Azmi

not going to be BMW la

im peasant looking ways to pay the maximum less amount interest to bank

take it 50k

and i found some links for the flexi loan i mention

http://www.cimbbank.com.my/en/personal/pro...e-purchase.html

https://www.rhbgroup.com/products-and-servi...cle-financing-i

while cimb have listed the amount....but is for foreign brand and non valid for local brand in the BFR

Hmm in this case you should get the opinion of hire purchase bankers from RHB and CIMB. Doubt you can find them in here. You have to walk in to the branch

Actually it is easy to compare in this case. All you ned to do is to get a quotation of the installments from both types of loans... in fact, just a quotation on the interest rates (simple insterest VS reducing balance insterest) should do, along with the amount that you are looking for.. then we can do the calculation together...

what is the consent to charge in terms of leasehold property?

You need to get the government consent first for any transaction involving leasehold property where its a buy sell or Refinancing because there is a clause on restriction within the property title.

And keep all when you deal with the government, expect delays in the handling of paperwork

i see. just have a glance at e-consent website, proses selesai. i guess lawyer lazy to follow up with land office?

All these paperwork are still done by human, whether it involves the bank officer, lawyers or the government, if you need to rush to get through to the final process then by all means call the lawyer, bank officer in charge and the government bodies daily and do the follow up yourself.

Think of it another way is that, why not do everything yourself right ?

spot on! charge legal fees but slow follow up.. need to inform my sis on the e-consent approval.

Can i refinance my fully paid up house while not hvg job/income?

Hi

You can refinance a fully paid property but you need to show proof to the bank that you're earning some sort of stable income.

Therefore you can't apply for refinancing at the moment unless you can show proof of income.

Otherwise, you can refinance it under your spouse name if you're married using your spouse's income.

Guess so.thx for reply.

Yes, that is normal.. They are all human so can't really let go without any follow-up

Possible, but you need to have some sort of income to pay the installments. rental, business, commisions, are all some types of income that you can provide

Is below calculation correct for refinancing house ? :

Assuming the house is worth RM400,000, outstanding housing loan balance is RM150,000, interest rate is at 4.6% and Margin of Finance is at 90% of market value

Amount to cover outstanding balance = RM150,000
Tenure = Max 35 years
Monthly Installment = RM719.20

Cash Out Amount = RM210,000
Tenure = Max 10 years
Monthly Installment = RM2,186.54

Total Refinance Amount = RM360,000
Total Monthly Installment
= RM719.20 + RM2,186.64
= RM2,905.84