hi sifu, wanna check with anybody who has experienced selling of property. i just recieved the redemption sum from my bank, however the amount is about 8k higher than the account loan balance. is there a reason for this? normal?

One of the reason could be your early settlement period is not due yet, hence the penalty interest was imposed.

This post has been edited by mini orchard: Oct 1 2017, 05:06 PM

the lock in period is already over. and i refer back to the offer letter, seem like no charges shall apply.

Read the fine print of your loan agreement again.The offer letter is just a brief summary. The full t&c is in the agreement Could you have missed out something.

If you find nothing wrong, see the bank officer for an explanation. Then if you wish, can share the answer here so that we can learn something from it.

Answers here are mere speculations, including mine.

This post has been edited by mini orchard: Oct 1 2017, 05:58 PM

those are called contingency fees.

not stated in the offer letter i think. thanks for the replies tho. gonna contact the bank and demand for explanation tomorrow.

will share here if something that could learn

some banks don't specifically reflect what they include in the redemption sum (which is why people called them "hidden costs") but these contingency sums will be credited back to you (if excess).

so far, i have only seen CIMB reflecting these contingency sums on their redemption statement. good practice.

made the call to the bank branch. the mortgage personnel can only explain in general the items covered under the redemption sum is the loan balance, forecast of the interest up to the final date of the redemption statement, and contingencies fees 3000-5000 based on loan amount which basically to cover for the variation in the blr and others. the excess to be refunded to borrower.

asking my lawyer to write to the bank to get the detailed breakdown of the claimed amount. and committment on the refund since none if these matters are stated in the redemption statement letter. the letter is pretty much one sided towards the bank.

i think bank shud just be transparent at first place and provide these infos in the first letter of the redemp statement and save all the hassle and uneasiness feeling of borrower. otherwise ppl will easily speculate that there are hidden charges etc

hi tumpang thread. i got query regarding redemption sum also. the sum also higher than the outstanding balance.

The bank charge me for 4 items:
1. Add profit to be earned
2. contingency fee
3. Service charge
4. GST

So can this charges be waived ?????. From what I know, i still pay the bank the installment. Also since they earn from interest, why need to charge for contingency fee. My loan is islamic bank and i believe there is no lock in period.

Furthermore, GST is calculated from service charge only, so i dont think they deserve to charge me extra for "profit" and contingency fee

This post has been edited by kurtkob78: Oct 2 2017, 02:29 PM

Good luck in getting what you requested from the Bank

In Islamic loan, the term "interest" does not exist so no, they don't earn from your "interest".

Contingency fees are payments in which the Bank takes in advance in the event if there is any monies they have calculated less. The reason this is levied because the payment will be your LAST payment so the Bank cannot ask for more monies from you and the Bank fears that they could charge less, that's why they will refund to you if any in excess.

You need to clarify again with the Bank, I don't think they levied GST on the loan repayment sum.

what is exactly item no 1. and 3. ?

additional profit?

my lawyer just send them the letter. see whats the reply.thanks for sharing the infos

see shaniandras' post.

should be bank ask for additional sum as "deposit". From what I understand, they should return to vendor if there is any excess after settled.

This post has been edited by kurtkob78: Oct 2 2017, 03:45 PM