Plenty of threads have been created about ASB financing in Kopitiam (so don't need to move this to Finance sub-forum la), this is no difference, but it starts without the ignorance of the thread starters. Many (either purposely or sincerely) mistook ASB-financing returns as the difference between the interest rate vs the yearly returns (distribution). Nothing can be further than the truth. The loan interest is calculated as a reducing balance, while the distributions (often mistakenly referred to as"dividend") is calculated on a yearly compounding basis.
 
In a way, ASB-financing is no different than buying a house with a mortgage. Both has a collateral which backs the loan, allowing the bank to approve the loans at low interest rates (4.4%-4.85% VS personal loans and credit cards with much higher rates). The main difference is in the collaterals themselves. To buy a house, you would bleed money to:

a) buy - SPA/LA/MOT/SD/Valuation/MRTA/10%-deposit
b) maintain - damages/rental-defaults/maintenance-fees/sinking-funds/cukai-pintu/cukai-tanah/fire-insurance
c) sell - RPGT/agent-fees/charge-to-discharge

No such thing with ASB and ASB-financing. You can invest in ASB just like any other unit trust, but at the same time you have the option of taking a loan to finance the investment:

a) There are no deposits required, you can get 100% financing
b) No legal fees involved other than RM60 for endorsement and stamping fees (not stamp duty)
c) Distributions are calculated on a prorated basis, there are no "distribution defaults" like when you are renting out your properties
d) No fees nor taxes to sell, there is a ready buyer - ASB is always ready to purchase the units and return your investment value to you in cash

Projections and assumptions:

1. Bank interest (financing) rate of 4.85% p.a - which may change according to the bank's base-rate (BR) movement
2. ASB expected returns of 6.5% p.a - which is lower than the historical lowest return of 7% a year for 2018 distribution
3. Loan and investment tenure of 35 years - maximum tenure, for 30 years old and below
4. Distributed units left in the ASB account to experience the effects of compounding
5. A small one-off insurance with the bank's panel insurance for RM350, capitalized into the financing

Total unit value after 35 years: RM1,812,450.97


Total loan repayment after 35 years: RM416,665.20


Bonus info. Total unit value after 35 years, but with cash-investment of the same monthly installment of RM992.06: RM1,528,086.67 . A difference of RM284,364.30 compared to investing using financing

I told you, it is not "3%". Reducing balance vs compounding interests.

Penatlah!!!!!       

Not much liabilities

1. no negative returns (unlike UT)
2. no loan guarantees, it is treated like any other loans 

What you said is incorrect and misleading, but I cannot expect more from you 

Thin air? Would you describe that with properties? 

Because ASB-f and mortgages have the same principle. Collateral-borrowings

Actually more like u can take the money to buy asb one shot and then every year withdraw amount ngam ngam to repay the loan amount. I bet with this technique you still have some money left in your asb after u have repaid the amount. Tat is what I meant by generating money out of thin air.

ASB was created as tongkat to the Bumiputeras, because they do not invest their money. So ASNB was created to run ASB to encourage Bumis to save. Please read your history     

Distribution, not interest. Interest is what the bank charges you.

If you are smart, you can make more money in Kenanga Investment lah. The only good thing about ASB is that it can be collateralizd, which means you can start your investment at RM993 a month but get RM200k in capital, at low interest rates.

But you are rich already, already have RM200k in hand, why bother? Just invest in Kenanga.

disclaimer: I do not work as Kenangar nor ASB agent.
omg. you really dont know what you are missing.

I do not engage. Don't ask.

U mentioned if you are smart. Not everyone is smart in investing. those comes with risk. Asb is risk free. As simple as that.

I got no lobang. I personally feel wrong about it. ASB is meant for bumi but hey what the hell do I know about "unfairness".

There are "agents" that engage in these proxy things. I don't. Normal arrangements that I know of is: you pay the monthly installment, and the "proxy" gets 10% of the distribution each year. You can either keep the 90% in the fund to let it grow or withdraw it to be reinvested into your own funds.

I have never heard of anyone prosecuted for this, but I am sure it is not strictly legal. Sounds and look like money laundering?

Why need proxy to help invest in asb. Asb office so many. Walk in and just let them fill all the form for u right? Hahaha

Like I said, Muslim converts can invest in ASB 



huh. That's weird. They consider Siamese and Portugese as eligible to invest in ASB but not Chinese and Indian?    hurm...
Told you this once before, when the returns are annualized, ASB returns are nothing to shout about leh. Public Mutual funds like Ittikal is comparable

And yeah, honestly. Why not just open asb to all. And everyone can invest without limit. Get good return. All can sit down and relax see the money comes. Everyone happy. Peace everywhere

Since their managing so good can get high return every year. Public mutual also lose.

if i am born in sabah, have sabah ic and passport, but im no bumi , im excluded right?

Has to be Malaysian citizens though

why not just ask the Malays?

plenty of Malays who cant afford to pay RM993 a month