Hi All,

For Mortgage Loans, between MRTT and MRTT with Critical Illness Coverage, which one is necessary or better to take?

Is it necessary to have longer MRTT/MRTA or should opt for a shorter one?

Different banks offers different MRTT/MRTA coverage with different coverage periods.

Please advise

Thank you

Both are the same, one is takaful another is conventional insurance. If you don't need any protection, and just to satisfy bank to get this for lower interest rate then get the shortest possible term.

But if you want real protection better get MLTA or normal life insurance, if you concerned about critical illness coverage, then get the coverage too.

To properly get covered using MRTA/MRTT, you really need to follow the loan amortisation curve and need to add a few basis points to cater for rising interest rate environment.

This post has been edited by AbbyCom: Oct 20 2022, 03:00 PM

Is depends on what you have now and what you want.

All mrtt or mrta should cover the full loan and tenure. Anything short of it is to borrower's disadvantage.

One wouldnt know what will happen tomorrow.

This post has been edited by mini orchard: Oct 20 2022, 03:15 PM

Mrta or mrtt is on the principal sum. Interest rates will not affect it as any increase or decrease will be in the next instalment payment. Unless borrower default, then it will lead to 'complication' in the event of a claim.

This post has been edited by mini orchard: Oct 20 2022, 03:21 PM

You don't know how banks could change things up - during the MCO loan moratorium, principal sum increased after the moratorium. And any interest change without corresponding change in instalment amount will change the loan period or principal's amortisation. Any of these risks - the banks or the family members don't care, it's the person who took the loan that should care, if not, then cases like why someone faithfully paying loan instalment for 20-30 years only to find the principal amount have been reduced maybe by 30% rather than fully paid off.

https://dayakdaily.com/retired-couple-shock...rs-of-repaying/

p/s : I know you are much more experienced in real estate investments and own much more properties than me, so I am saying the above not out of superior knowledge but more for sharing what I know and learning a few things, esp from senpai like you.

This post has been edited by AbbyCom: Oct 20 2022, 03:32 PM

That is why I mentioned 'default" ... which include moratorium.

Then is the borrower's duty to check with bank on how to resolve the coverage to protect his interest.

In any insurance purchase, life, medical, motor, fire etc, it is the duty of the insured to ensure he is adequately protected. Shifting the blame to others is not a wise decision as the bank will foreclose the property in the event of non settlement of the loan sum.

I read the news report with a pinch of salt as there are more details that are not reported.

This post has been edited by mini orchard: Oct 20 2022, 03:39 PM