you can.. any excess payment consider as advance payment.. whether reduce your principal and debit credit your balance depending on your loan type.. fixed rate/semi flexi or full flexi loan.. mostly should be semi-flexi loan which will consider as advance payment.. some bank have a cap like 50%/70%.. i knew MBB didnt have this cap, so if you have 200k on hand and dont know what to do, put into the semi flexi loan treat it as advance payment, then when you pay monthly installment 2k, maybe 1500 reduce principal and 500 for interests rather than 500 principal, 1500 interests if without 200k advance..

yeah.. interests are count in daily basis.. and it did..

e.g. your monthly payment is 2k.. it will split into principal & interest payment.. if your advance payment a lot, the ratio of monthly payment 2k will be go to principal more than interests.. indirectly it will reduce your principal balance more and help to shorten the loan term..

my suggestion to normal people is extra pay extra RM50/100 per month is very good for own stay purpose.. it will shorten your loan term for few years for sure.. assuming your house loan is odd number like 1943 per month, you pay 2k straight.. surplus 57 a month is good.. if got big lump sum and considering either FD/throw into mortage semiflexi/flexi loan, and dont plan to take out the money in short time, just lump into loan account instead of FD.. the only cons is that when u want to take out the money, it will incur an amount like RM25/50 depending on bank.. full flexi is fine cause it go to current accounts straight..

you are right from the term.. from my own experience perspective, i have 3 mortgage loan, 2 in HLB and 1 in MBB.. they are same.. im using semi flexi instead of full flexi.. mortgage loan interests are calculate in daily basis as far as i knew if you go to semi flexi & full flexi loan.. it not deduct your principal and it is serve as advance payment which you are right. but your interests are count based on (principal - advance payment) x interests rate..

unless you call to bank and ask them to use advance payment to deduct your principal.. (indirectly you cant withdraw it out anymore after this)..

for normal working people and the property is own stay.. yes.. i dont see the cons to not putting the extra money in semi flexi loan account.. i attached a screenshot about the actual transaction in my sample.. when u have a lot of advance payment, your monthly principal deduction amount will be increased, of course there is a factor of 30 days, 31 days for each months..

e.g. 03 Apr 2023 been debit 1376.67 interests in my account.. it is due to March have 31 days.. average per day is 44.41 for interests..when go to 03 May 2023, my account debit 1330.25 cause use 44.41 x 30 days in Apr.. which is around 1332.30 or exact number by bank is 1330.25... minor difference is based on when we pay monthly installment amount into account, and it will have minor difference due to your principal - advance payment is lower again..

my advice is pay a little extra is fine like my sample is 1955 for monthyl installment, but i paid 2000 every month.. slowly your advance payment will be accumulated after maybe 5/10 years.. if you have bonus every year, just lump into it.. when you need cash liquidity, just have to go to bank and fill up some form and cash out the money from your advance payment (but limited to cash out by thousands value, e.g. 1k/2k/3k/4k like that, cannot take out 500/1900).. and it incur small charges like RM25/50..



sorry as im not good in explaining all these in professional ways.. but i hope you guys can understnad my broken english..


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current account? are you having full flexi loan account? only flexi loan tied to individual current account. how long u have the mortgage loan? usually current account will have monthly/yearly fee.. check there is any small fee charge into your current account?!

it is fine to pay extra every month.. it will automatically reducing the interests on your loan.. the benefit of having current account is that you can make additional payment/withdraw money from your current account without having any pre-approval from bank.. but cons is there should have a minimum maintenance charge in monthly/yearly basis..

wont.. it will deem as advance payment.. it wont deduct directly.. loan instalment is automatically taken each month from advance payment as per pre-approved schedule.. e.g. your instalment must paid by every 5th of Month.. make sure you have enough money in account before 5th of month..

generally it should be all same.. except certain bank have a max cap of advance payment to reduce your interests.. e.g. your principal loan is 500k.. if you dump 400k into it as advance payment.. will it use only 100k remaining balance to count your interests?! not really.. some bank have a cap like 50%/70%.. this one you have to check with your banker/in your loan agreement..

This post has been edited by ChuanHong: Oct 11 2023, 09:26 PM

Your monthly installments amount will used to pay off principal more than usual. In long run, yes interests reduced and you may pay off your loan earlier than your loan term.

For someone like me that don't know what to invest, I just lump my extra into loan account only as advance payment..

hmm.. loan principal 1m.. advance payment 200k.. outstanding balance = 800k to multiply/calculate your interests..

lets assume advance payment cap is 70% = 700k of advance payment.. if you put advance payment 800k, 1000 - 700 (cap) isntead of 800k. ultimately = 300k to multiply/calculate your interests..

This post has been edited by ChuanHong: Oct 19 2023, 10:16 PM