Sep 9 2008, 03:17 PM
QUOTE(...PS... @ May 27 2008, 10:19 AM)
Hi... wanna ask something regarding Flexi vs Fixed Loan, & Daily vs Montly Rest...
My understanding (Flexi vs Fixed):
---------------------
Fixed Loan: for extra prepayment, it reduces your principle. Hence, it helps to reduce the interest
Flexi Loan: for extra prepayment, it will just park in your current account. And it "virtually" reduce your principle. Hence, it helps to reduce the interest (same as above), except that you can withdraw back the extra prepayment anytime, no charge (apart from other maintenance fees). Then the interest will be recalculated =
[ (the actual amount you owe bank - virtual prepayment you made) * interest rate / 365 ].
With my understanding above, if flexi n fixed loan come with a same rate, no way the fixed loan can be better than flexi loan, right? Or is there any other benefit on the fixed loan (let's say we omit the setup n montyly charges)?
Daily vs Montly Rest
-----------------------
Everytime i see in the brochures, the bank will says smth like "interest is calculated on daily basis, so you can save on the interest". But isn't it with daily basis, the calculation will be in a Compound Interest way where you actually pay more interest instead of saving them? whereas for montly rest, it will be calculated once a month (net outstanding amt * interest rate / 365*30)?
I'm very interested in this terminology between Flexi and Fixed loans as well, need to decide which type is better for me in the long run to save on interest.My understanding (Flexi vs Fixed):
---------------------
Fixed Loan: for extra prepayment, it reduces your principle. Hence, it helps to reduce the interest
Flexi Loan: for extra prepayment, it will just park in your current account. And it "virtually" reduce your principle. Hence, it helps to reduce the interest (same as above), except that you can withdraw back the extra prepayment anytime, no charge (apart from other maintenance fees). Then the interest will be recalculated =
[ (the actual amount you owe bank - virtual prepayment you made) * interest rate / 365 ].
With my understanding above, if flexi n fixed loan come with a same rate, no way the fixed loan can be better than flexi loan, right? Or is there any other benefit on the fixed loan (let's say we omit the setup n montyly charges)?
Daily vs Montly Rest
-----------------------
Everytime i see in the brochures, the bank will says smth like "interest is calculated on daily basis, so you can save on the interest". But isn't it with daily basis, the calculation will be in a Compound Interest way where you actually pay more interest instead of saving them? whereas for montly rest, it will be calculated once a month (net outstanding amt * interest rate / 365*30)?
By the way, I recently called up one of my housing agents, I want to buy an RM 255K house, loan 90%, tenure 30 years, BLR 6.5... she calculated and said the monthly installment is RM1,300. Wonder if it is correct....
By the way, I am 25 this year. Can tenure be 35 years?
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