off topic but somehow, people didnt still get ASB Loan... high risk for low gain? do you guys know what leverage mean?

let say you take 100k asb loan, and it is 540 per month
lets compare that against just investing yourself in ASB for 540 per month shall we

540x12= 6,480
dividend = 7%
let say interest at 5.5%
interest amount is on reducing balance but for the sake of easy calculation let just say you pay on balance 100k 1st year (real number would be lower since you pay monthly)
1 year interest = 5,500

at the end of 1 year this is how much you will get if after 1 year straight away cancel loan
total investment = 6480
total return = 6480 (principal) + 7,000 (dividend on 100k straight) - 5,500 (interest)
= 23% ROI

vs

invest yourself = 6480 (principal) + 227 (dividend on 6480 adjusted monthly contribution)
= 3.5% ROI

Max for ASB either loan or not is 200k bro... there is no need to get defensive and attack experience or not, im just replying to say that statement that you are taking a major risk for a small gain is misleading since you deduct directly from %return to %interest and not taking into account the leveraged amount that the % is calculated against... IMO the return is actually outweigh the risk since what other investment vehicle that the capital is guaranteed?

This post has been edited by feiraron: Jul 26 2018, 12:18 PM

its funny that TS created this in order to avoid the hijacking the ASB loan thread and now the ASB Loan discussion is here

TS, my personal opinion is simple, honest and comes from personal experience. hope you like it better than listening to people throwing jargons around to feel superior. since you are talking about credit score, banks would like to see a few things: 1) has a relationship (use any of their product) 2) evidence of ability to pay that relationship 3) Prompt payment of those relationship

try imoney.com to see which CC has minimum salary to apply of 2000 (i think thats the minimum as it gets) but if you do get it, please please know that it is a double edge sword and it is always tempting to know that you have that credit limit that you are able to spend. In other word it can end up hurting your credit score much more than having unknown credit score

personal finance is 80% behaviour and only 20% math. I would equip myself if i were in your situation with budgeting knowledge such as zero sum budgeting (i find that this is the best method for sticking to budget) because if you have this then you yourself can tell whether you can afford a car or a house rather than rely on credit score hoping it will tell the bank you are qualified or not. Banks always wants to give out money to qualified person anyway, no need to fret too much as long as you take care of your money in (income) side of things.

Where ASB Loan comes into picture, NOT because it is no risk, but because it is FORCED savings. it wont hurt your DSR much if you are just in it to create that relationship dont take that big of a loan and max your term. it tick all the boxes,
1) it is not that hard to get (my wife 2.4k salary can get 100k approved easily) banks are practically paying people to give this out for reason no 3
2) have a relationship with bank, show you can make prompt payment AND make money while you are at it
3) if anything happen cancel anytime, yes you may lose money in the event that the dividend is lower than interest, but it is limited to what you already paid, there wont be people chase you to pay back the loan (like some are suggesting because they dont understand capital guaranteed) unless Malaysia (yes the whole country's government) is bankrupt but if that happen you have much more things to worry about than your credit score

What other alternative? Personal loan, please avoid at all cost unless you like to give yourself a long time stress and very short term happy feel. if you say what if use for investment or business, then i agree with cfkoon, your loss here is guaranteed but your return isnt.

This post has been edited by feiraron: Jul 27 2018, 12:27 PM