i've been offered this markup loan.
i'm buying this property for own stay.

when i first heard of this idea, i loved it as i could use the zero downpayment and put that amount elsewhere.

i've also read the other threads here about this mark up loan approach and i understand it is a grey area thing.

so here's the scenario, i can afford to pay the downpayment for this property BUT i would love to use that amount to clear off existing car loan.

hence, this mark up loan with zero downpayment sounds great.
my dilemma is, will there be any issues going with this approach in the future?
anything that i should be aware of aside from the higher monthly loan repayment?
or should i just go with the regular approach with 10%-15% dp?

i'm new to this and would love to hear more opinions.
thanks

i think to answer this conclusively, u need to model the scenario in spreadsheet
why not just model ur scenario n plug in the actual numbers and use variables in ur formulas, so that u model different scenarios

that's a good idea.
thanks

indeed, the overall scenario has a lot of variables.

but car loan is not reducing balance right? so even u pay off halfway, ur interest in on the original car loan sum.
So it makes sense to me to pay off car loan first and BR not likely to go up anytime soon.

Subsale markup price is possible if valuation report okay.. bank also depend on that report as well.. they can offer as high as your financial condition will allow.. but u cant markup until like average those house are 400k but u want 600k.. valuation report is not that easy unless u can get someone sign the report for u.. new project is possible if you are doing bulk purchase.. get lower price of property but higher amount in SnP.. rarely got developer do this lubang..

to me, it's kind of stupid to get markup portion to pay off your car loan.. unless your mortage loan serve less than 10 years.. unless you are meant for cover future renovation course which i could understand.. cover car loan?! a BIG NO.. car loan is fixed rate.. assuming u get 3% in car hire purchase agreement.. but house is depending on BR rate.. now probably you feel interests sounds lows, maybe 2.9%.. but once BR increase back to normal in 5 years time.. which will easily go to 4.5%..

why valuation company's report have market value & forced sale value?

when bank look at it, it will follow the market value or forced sale value?

Lets' say market value stated in report 400k, forced sale value 320k.

Forced sales value is kind like lowest property price or minimum value of the property value.. mean average you sure can sell this property at 320k.. basically, follow your lawyer that prepare the SNP..
Your sales value is lower than market value, so SNP is 320k.. assume loan amount is 90% then 288k.. usually mark up loan amount is increased your property SNP price to higher value in order to get extra loan amount.  It's possible to do so under few criteria..

1.your seller ok and agree for you to do so.. (cause RPGT.. but now no need to pay so it's fine..)
2. Your financial allow you to do so
3. Valuation report of property

Layman explanation: only thing is you can't market a 400k market price property to get 600k+.. valuation report will show recent transactions of same area and what is top price . Bank will use that as one of benchmark.. surrounding same property sold at 400k and why u buy at 600k..

So, bank see the report’s market value or forced sales value ?

Market value report is 400k
Forced sales value is 320k

Market value..

How do we make sure that the owner will follow the lower price agreed then?