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> Bank loan expert come in, House loan

Docile
post Feb 11 2019, 03:38 PM, updated 5d ago

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Hi Sifus,

I have a house loan of a 1.7k monthly with a 35 yrs tenure.
So far i am only on the 5th year.

I am wondering if i can redo my loan?
Make it 10 years and pay more monthly.

Because i calculate, if i pay 1.7k monthly for 35 years, total loan would be 714k, which is almost double the amount of the house price.
I would like to redo the whole loan to 10 years, and pay more every month.

Is this possible?

yeeck
post Feb 11 2019, 03:41 PM

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You can actually pay more to settle the loan faster, no need to redo. Unless your current loan interest rate is much higher.

This post has been edited by yeeck: Feb 11 2019, 03:42 PM
thefryingfox
post Feb 11 2019, 03:41 PM

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Not possible. Bank will want you to pay and stretch if you are a good paymaster
Docile
post Feb 11 2019, 03:49 PM

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QUOTE(yeeck @ Feb 11 2019, 03:41 PM)
You can actually pay more to settle the loan faster, no need to redo. Unless your current loan interest rate is much higher.
*
Yes i do understand we can pay the principle to reduce the loan amount

But i want something that would force us to pay more.
If we pay principle when we have extra money but its not compulsory, most would not pay.

But if the amount already set in our bank loan, we are compulsory to pay.
shyan90's
post Feb 11 2019, 04:05 PM

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QUOTE(Docile @ Feb 11 2019, 03:49 PM)
Yes i do understand we can pay the principle to reduce the loan amount

But i want something that would force us to pay more.
If we pay principle when we have extra money but its not compulsory, most would not pay.

But if the amount already set in our bank loan, we are compulsory to pay.
*
You are an adult and can control yourself.
It takes quite some time to refinance your house if not mistaken.
Just pay more instead refinance. If really want to "force", can ask your company direct pump in a certain amount to your housing loan account.
kirakun
post Feb 11 2019, 05:30 PM

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QUOTE(Docile @ Feb 11 2019, 03:38 PM)
Hi Sifus,

I have a house loan of a 1.7k monthly with a 35 yrs tenure.
So far i am only on the 5th year.

I am wondering if i can redo my loan?
Make it 10 years and pay more monthly.

Because i calculate, if i pay 1.7k monthly for 35 years, total loan would be 714k, which is almost double the amount of the house price.
I would like to redo the whole loan to 10 years, and pay more every month.

Is this possible?
*
Depend on type of housing loan u took, fixed or flexi or semi flexi.

Full flexi typically allow u to throw in any surplus money that u have into your principal loan account to offset the balance anytime any day. Interest is calculated from the balance on daily basis.

Suggest u seek your banker who did your house loan for further clarification and advice.
I'm V-Kool
post Feb 11 2019, 05:38 PM

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https://malaysiahousingloan.net/steps-home-...hing-need-know/

Hope this help
Yggdrasil
post Feb 11 2019, 06:35 PM

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QUOTE(Docile @ Feb 11 2019, 03:38 PM)
Hi Sifus,

I have a house loan of a 1.7k monthly with a 35 yrs tenure.
So far i am only on the 5th year.

I am wondering if i can redo my loan?
Make it 10 years and pay more monthly.

Because i calculate, if i pay 1.7k monthly for 35 years, total loan would be 714k, which is almost double the amount of the house price.
I would like to redo the whole loan to 10 years, and pay more every month.

Is this possible?
*
I presume you borrowed around RM400k. It is impossible at your income level to shorten it to 10 years since 15 year loan at a similar interest rate would mean you need to fork out RM3000 per month for instalments. This is assuming you earn around RM5000 a month.
LamboSama
post Feb 12 2019, 01:57 AM

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Simple answer, you can refinance.
Should you refinance is more complicated.
red4900
post Feb 12 2019, 07:06 AM

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Refinance means signing new loan agreement isnt it?

All the loan fees and lawyer means more money isnt it?
Daddy2be
post Feb 12 2019, 08:21 AM

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Don't be offended but it took you 5 years to figure out how much the loan will cost you ? Did you not know how much you will pay during the entire loan ?

Signature so easy to come by these days
Docile
post Feb 12 2019, 08:38 AM

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QUOTE(Daddy2be @ Feb 12 2019, 08:21 AM)
Don't be offended but it took you 5 years to figure out how much the loan will cost you ? Did you not know how much you will pay during the entire loan ?

Signature so easy to come by these days
*
I did know how much when i sign, it's just that during that time I was still working on my career so i pay the minimum.
But now i have alot of extra money, and plan to immigrate to other country, so im thinking to shortern it and clear the debt asap so it would not held me back

Thanks for your assumption
shyan90's
post Feb 12 2019, 10:19 AM

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QUOTE(Docile @ Feb 12 2019, 08:38 AM)
I did know how much when i sign, it's just that during that time I was still working on my career so i pay the minimum.
But now i have alot of extra money, and plan to immigrate to other country, so im thinking to shortern it and clear the debt asap so it would not held me back

Thanks for your assumption
*
Lets said you plan to migrate to another country. Just serve your current loan until you migrate, then sell your house. Hassle free! rclxms.gif
There are no differences you have to settle the house or you still serving the loan when you sell the house.
flyingspurs
post Feb 12 2019, 10:43 AM

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Hi There, i m an ex-banker, let me guide you the proper way, you have a few option:
1) Re-structure the loan, you can call your bank / walk in to any branch, request for a loan restructuring form, pick the loan tenure option, write your request, it will took 2 week for bank to process and will update u via phone/ mail / email, depends on your choice of communication, usually the servicing branch / home branch of your loan will contact u on this or you can check with the bank before next installment.
2) Without altering your loan package, continue to pay Pre-payment, NOT Advance payment. Prepayment will offset your principal and you CANNOT withdraw back the money you pay, your usual installment will remain same but you can opt to pay the extra into Prepayment, please indicate to your bank, usually Over The Counter, or in your online banking (if your bank having this feature), your extra payment is prepayment and usually its in the round up of thousand, ie 10K, 12K etc. not odd figure of 10,018 etc.
3) Paying extra ie installment amount + extra amount without telling the bank will auto define by bank that your extra will park under Advance Payment, which DID NOT reduce your principal amount, but reduce the interest based on principal balance - extra payment x interest. Advance payment allow you to withdraw later if u need that cash with a processing fee. MBB charge RM 25 if not mistaken.

*Do note that both prepayment & advance payment did reduce your interest, however, some bank will only start reducing interest if your advance payment is more than X month of your installment.

4) Refinancing. This will move u from bank A to bank B with a fresh loan package according to whatever tenure u like / approved based on your eligibility. However, this will involved additional cost of legal fee & stamp duty & valuation report fee. Not recommended unless your current package is much higher interest compare to current market offering.

I hope the above give u some guideline.

*All 4 option above in the end will shorten your loan tenure.

and i m not agent / banker now i dont do any loan / referring.

This post has been edited by flyingspurs: Feb 12 2019, 10:47 AM
Docile
post Feb 12 2019, 11:08 AM

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QUOTE(flyingspurs @ Feb 12 2019, 10:43 AM)
Hi There, i m an ex-banker, let me guide you the proper way, you have a few option:
1) Re-structure the loan, you can call your bank / walk in to any branch, request for a loan restructuring form, pick the loan tenure option, write your request, it will took 2 week for bank to process and will update u via phone/ mail / email, depends on your choice of communication, usually the servicing branch / home branch of your loan will contact u on this or you can check with the bank before next installment.
2) Without altering your loan package, continue to pay Pre-payment, NOT Advance payment. Prepayment will offset your principal and you CANNOT withdraw back the money you pay, your usual installment will remain same but you can opt to pay the extra into Prepayment, please indicate to your bank, usually Over The Counter, or in your online banking (if your bank having this feature), your extra payment is prepayment and usually its in the round up of thousand, ie 10K, 12K etc. not odd figure of 10,018 etc.
3) Paying extra ie installment amount + extra amount without telling the bank will auto define by bank that your extra will park under Advance Payment, which DID NOT reduce your principal amount, but reduce the interest based on principal balance - extra payment x interest. Advance payment allow you to withdraw later if u need that cash with a processing fee. MBB charge RM 25 if not mistaken.

*Do note that both prepayment & advance payment did reduce your interest, however, some bank will only start reducing interest if your advance payment is more than X month of your installment.

4) Refinancing. This will move u from bank A to bank B with a fresh loan package according to whatever tenure u like / approved based on your eligibility. However, this will involved additional cost of legal fee & stamp duty & valuation report fee. Not recommended unless your current package is much higher interest compare to current market offering.

I hope the above give u some guideline.

*All 4 option above in the end will shorten your loan tenure.

and i m not agent / banker now i dont do any loan / referring.
*
Thank you so much for your feedback.
I guess restructure loan would be the best option for me.
raizen
post Feb 12 2019, 11:23 AM

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QUOTE(flyingspurs @ Feb 12 2019, 10:43 AM)
Hi There, i m an ex-banker, let me guide you the proper way, you have a few option:
1) Re-structure the loan, you can call your bank / walk in to any branch, request for a loan restructuring form, pick the loan tenure option, write your request, it will took 2 week for bank to process and will update u via phone/ mail / email, depends on your choice of communication, usually the servicing branch / home branch of your loan will contact u on this or you can check with the bank before next installment.
2) Without altering your loan package, continue to pay Pre-payment, NOT Advance payment. Prepayment will offset your principal and you CANNOT withdraw back the money you pay, your usual installment will remain same but you can opt to pay the extra into Prepayment, please indicate to your bank, usually Over The Counter, or in your online banking (if your bank having this feature), your extra payment is prepayment and usually its in the round up of thousand, ie 10K, 12K etc. not odd figure of 10,018 etc.
3) Paying extra ie installment amount + extra amount without telling the bank will auto define by bank that your extra will park under Advance Payment, which DID NOT reduce your principal amount, but reduce the interest based on principal balance - extra payment x interest. Advance payment allow you to withdraw later if u need that cash with a processing fee. MBB charge RM 25 if not mistaken.

*Do note that both prepayment & advance payment did reduce your interest, however, some bank will only start reducing interest if your advance payment is more than X month of your installment.

4) Refinancing. This will move u from bank A to bank B with a fresh loan package according to whatever tenure u like / approved based on your eligibility. However, this will involved additional cost of legal fee & stamp duty & valuation report fee. Not recommended unless your current package is much higher interest compare to current market offering.

I hope the above give u some guideline.

*All 4 option above in the end will shorten your loan tenure.

and i m not agent / banker now i dont do any loan / referring.
*
Very detail explanation. TIL, thank you.
bonkers28
post Feb 12 2019, 02:56 PM

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QUOTE(flyingspurs @ Feb 12 2019, 10:43 AM)
Hi There, i m an ex-banker, let me guide you the proper way, you have a few option:
1) Re-structure the loan, you can call your bank / walk in to any branch, request for a loan restructuring form, pick the loan tenure option, write your request, it will took 2 week for bank to process and will update u via phone/ mail / email, depends on your choice of communication, usually the servicing branch / home branch of your loan will contact u on this or you can check with the bank before next installment.
2) Without altering your loan package, continue to pay Pre-payment, NOT Advance payment. Prepayment will offset your principal and you CANNOT withdraw back the money you pay, your usual installment will remain same but you can opt to pay the extra into Prepayment, please indicate to your bank, usually Over The Counter, or in your online banking (if your bank having this feature), your extra payment is prepayment and usually its in the round up of thousand, ie 10K, 12K etc. not odd figure of 10,018 etc.
3) Paying extra ie installment amount + extra amount without telling the bank will auto define by bank that your extra will park under Advance Payment, which DID NOT reduce your principal amount, but reduce the interest based on principal balance - extra payment x interest. Advance payment allow you to withdraw later if u need that cash with a processing fee. MBB charge RM 25 if not mistaken.

*Do note that both prepayment & advance payment did reduce your interest, however, some bank will only start reducing interest if your advance payment is more than X month of your installment.

4) Refinancing. This will move u from bank A to bank B with a fresh loan package according to whatever tenure u like / approved based on your eligibility. However, this will involved additional cost of legal fee & stamp duty & valuation report fee. Not recommended unless your current package is much higher interest compare to current market offering.

I hope the above give u some guideline.

*All 4 option above in the end will shorten your loan tenure.

and i m not agent / banker now i dont do any loan / referring.
*
Thanks for the tip!! thumbup.gif

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