1. You are completely wrong though, I have already given the definition of refinancing, and it is your own fault that you mistook the meaning of refinance as "getting free money". There is no such thing as "free money", the cash-out that you receive from refinancing is still a loan (backed by the property), and I always make that clear to my clients. It is not surprising that you are also finding it difficult to understand the meaning of "refinancing" which to you is more akin to refinancing of a mortgage account, with the so-called "free money" to boot. As you can't even grasp the technical meaning of refinancing i do not think it is a good idea to spread the misconception of what it really is.

As such, settling the current ASB loan and taking up a new one to enjoy better rates can be considered "refinancing", even if there is no involvement of "free money".

2. As for the comment about properties, I just have these few things to say:

a. real estate is just an investment vehicle, like many other including ASB/ASB2, it has no guarantees of return (capital-appreciation, dividend, rental). These talks about how a property is better or worse than other investment vehicles are coming from snake-oil salesmen. yes, the property is there, it is real and tangible (unlike ASB/share units), but there is no guarantee in its value, which is the crux of the issue that I have with people that are pushing properties as hard as they can. It is not wrong to talk about it, but we must recognize the fact there are properties bought in the past few years that are only retaining, if not losing their values over time. If this continues for the next 30 years or so, would you still be saying that a property is a good investment? What is wrong with renting?

b. as it is now, buying a house as a sub-sale (as it is for own stay now, undercon is not suitable) is a LOT MORE expensive than renting. Costs (including hidden costs) will eat you up, in the form of down payment, MOT, SPA, LA, fire-insurance, management fees, sinking fund, taxes, maintenance. This is just anecdotal, but based on my clients house prices that they are buying today, the rental income can never reach the installment alone, not including the other costs that I have mentioned. So you would have spent a lot of money on the upfront costs, and then you would have to spend more to pay off the banks through your mortgages.

Please consider these things before recommending one asset class to another.

There, facts right in your face. In fact, I have been dropping facts upon facts with numbers to back them up. That is my style, unlike you who seem to enjoy obfuscating facts as proven in your misleading definition of "refinancing" above.

This post has been edited by wild_card_my: Aug 23 2018, 03:37 PM

1. ASB-f

A. Incomplete question. What is the current outstanding of the loan, and what is the cash-value of the ARTA? This is why I always recommend clients not to take ARTA, people who do are getting bad advises, because when they need to refinance or settle the account, they would have to incur some losses (through the premium of the insurance agent which happens to be the bank itself). Currently the best rate is 4.9%, and some clients who took up ASB financing is currently being charged 5.45%, it would be a mismanagement of one's own finances if you do not look into the market rate and refinance the loan into something that is of better rates

Incomplete question, which suggests inexperience of the person asking the question. Please try again

B. As above, incomplete question (what is the original loan amount), but this is more doable. I assume John has paid for the financing for a few years, thus making the current outstanding reduced by a bit. He would have to ask the current bank to close the ASB-financing account, all the units (non-dividend, non-cash) would be sold off. Refinancing that loan would allow him to get 190k or 200k from the new bank, at the rate of 4.9%, he can take a reduced tenure or l. I dont understand what you are trying to do here.

By the way, may I suggest that you use the correct terms when posting your questions/assertions. Using the right terms, there are differences between the loan limit (original loan amount) and current principal outstanding. However you chose to write these instead: "currently has a loan of 209k" . Which is confusing and allows room for miscommunication. Usually I would visit INVESTOPEDIA when i am not sure about some terms because I avoid using the wrong terms, since as you can see in here and in the mortgage threads, I see myself as an educator of sorts.

2. On to the property side, I noticed that you love using anecdotal examples to back your points, of which I am not going to address mainly due to 3 reasons:

1. they are anecdotal and personal which do not represent the whole real-estate industry as a whole.
2. It could be coming out of your behind for all i know, a.k.a bullshit
3. There is no way that I can argue against personal experiences, we can hear about it, talk about it, but please don't use anecdotal experiences to prove you points.

What I claim is true though, a lot of publications are saying the same thing, here is one of them:Downtrend in property prices



On top of this, paper gains are not gains unless you sell it off. You need to understand the differences between liquid assets like cash/ut/asb vs real estate that takes between 3 to 6 months for the transaction to complete, if that.

You are right, with ASB-financing you can close the account in as soon as 10 days, as per my experience. So it is a good liquid investment. In the event when you need to buy a house, you can just call up the bank, fill up some forms, and the loan will be closed in a very short time.

Dividend income from the ASB can also be used as part of your total income, useful when the banks are calculating your debt-service-ratio. It will not be able to cancel out your commitments as a whole, but it is better than having the commitment but without the income (i.e hire purchase)

This post has been edited by wild_card_my: Aug 23 2018, 05:13 PM

Anecdotes coupled with years of industry experience, plus when anecdotes are not enough, I provide facts and figures like what I have done to you and other forummers in this thread and mortgage thread

And then you chided me for taking things too seriously by bringing up a graph. So which one is it? Make up your mind la, or do you prefer amateur hour arguments?

Anyways ASB financing has shown over and over against to generate returns to the borrowers, why? because the banks' BLR (note that I am not talking about OPR and BR here) has NEVER been higher than the ASB's yearly dividends, don't believe me? Check out these sources below. I have had about enough with you, I really dislike amateurs who don't know their place. You want to argue, fine, but when I furnish you with documents, data, numbers, figures, and statements, please back down instead of chiding people of taking things too "seriously".

These matters involve people's money and investments, of course I have to take things seriously unlike you who is treating it like a game.

ASB hisotrical returns

Bank's historical BLR

Just proving that the 4.85% p.a. rate is real. This is posted with my clients' permission, she wants everyone to grab this opportunity. Installment amount of RM794 for facility amounting to RM150,299.69 for 30 years tally with the calculated figure in the second photo. The rate is 4.85% p.a. for this client of mine.





This post has been edited by wild_card_my: Aug 24 2018, 07:07 PM

1. Mate, I thought you are done? You want to get serious or what about this? I mean like it is clear that you are the one missing the point. We started with the definition on refinancing, and now you went all tangent about it.

2. Refinancing your ASB loan that is in the low 5% to enjoy the current rates of 4.85% is beneficial to the borrower. That is the message that I am driving today. But you with all your lack of understanding mistook "refinancing" as a term exclusively used for mortgages. Refinancing is just to change the financier as per what Investopedia claimed and I quoted them earlier.

You got called out for your ignorance and is now trying to cover it up by asking something so dumb as "what will happen if one person refinances?". What do you expect will happen mate? I called you up again due to the incomplete question and as per what my professors said, incomplete questions are stupid questions. You tried to set me up with those questions but I pulled one better by calling you out - and the terms used were also confusing. You sound like someone who read a few Wikipedia articles and decided that he is now a scholar - this all shows in your questions.

3. Did you even know that BR moves based on OPR rates likely on the same quantum among all the banks? Doesn't seem that you do, because you don't even seem to understand the concept of BR + spread. The spread is fixed, but the BR WILL change over the years and no one is claiming that it can be guaranteed. No one said that the 4.85% rate will be fixed, only you claimed that it is, which shows your lack of understanding on how loans (mortgages, ASB-f) works. If you had you would not say what you did.

Arguing with you is like playing chess with a pigeon. All you are going to do is knock all the pieces down and shit on the board. Come on mate, get good, play some chess.

This post has been edited by wild_card_my: Aug 24 2018, 08:23 PM

1. BR movement is beyond our control as consumers, but notice that clients who took their loans even a year ago would have their effective rate raised due to changes in the BR while those who are taking it now would have their effective rate on the lower side. That is the fact in this industry now, as one of my banks are offering 4.85% p.a effective rate, while people who signed up for the loans last years are paying 5.00% p.a ++ , as high as 5.65% as shown below



2. Like i said, do you even understand how the rates are quoted? The spread is fixed, while the BR changes over time, based on what you post, doesnt seem like you have a clue on how it works.

If Jake is getting a BR + 1 last year (at the time when BR was 4%) making his effective rate 5%, and a year later the BR for that bank increases by 0.25% making his effective rate 5.25%, it would be stupid of Jake not to refinance if currently the bank is giving new costumers a rate of BR + 0.75% (making the current effective rate 5%)

Staying with the current bank and he has to pay 5.25% p.a , refinancing it to a new bank and he pays 5% p.a. That is the difference of 0.25% per annum!. I dont know why some doofus would question the need to refinance to save 0.25% on RM200,000. That is RM500 just for the first year alone, and this adds up although the saving reduces over the years. But the cumulative charges would increase indefinitely.

I seriously have a feeling that the fact that you do not get this concept suggests that you either:

a. have never signed a loan offer before
b. oblivious to it

As a broker for mortgage as well as ASB-financing I have resources from clients as well as banks alike to back my assertions. These are not mere opinions, I help my clients save and make money; while you are treating it like a game. it is funny that you questioned that I am using anecdotes when I posted proof, numbers, and figures, and when you can't prove anything, you are saying "this is just opinion" or "don't be too serious", but only after I handed you your "behind". Come at me, bro, I don't lose because I am right.

This post has been edited by wild_card_my: Aug 24 2018, 08:39 PM

This is why I told you your questions were incomplete:

1. What is the cash value of the insurance? Insurances have costs (commissions payable to the bank)
2. If he had not taken the insurance, the principal outstanding of the loan would ALWAYS have been lower than the current units in ASB

You are missing a few points. please, sit down and listen. nothing is more frustrating than some ignorant who refuses to learn:

a. ASB units are fixed-price. Regardless of the tenure, the price of one unit is ALWAYS RM1. So even if you took out ALL the dividends received every January, you would still end up with 200,000 units, worth RM200,000

b. The ASB-financing principal outstanding would ALWAYS be reduced over the time that you are paying your installments, even after the first month. An installment is made of 2 items: interest (paid to the bank as their profit) and principal repayment (used to reduce the RM200,000 principal o/s that you took earlier.

c. Insurances have upfront costs in the form of commissions payable to the bank (and shared with the banker), it is ignorant from your part to ask about the refinancing status for someone who has a principal outstanding of RM209k, and ASB units of RM200k, without sharing the cash-value of the insurance and without recognizing that the insurances have upfront costs that has already been paid up for.

You are infuriating because you asked those 2 "simple" questions to set me up, but you clearly show that you didn't understand how the ASB-financing works, nor do you understand how ASB units are priced. Nor do you know that these ASB Reducing Term Assurance (ARTT) has their own cash-value that can be redeemed upon surrendering the policies.

If you had known the above item, you would never asked those questions, but you did anyway in a way to set me up. So I had to call out to your ignorance. Good call on your part, now everyone is educated.

Wow, despite the fact that you have be involved in so many investment instruments, you fail to understand the basics of ASB and ASB-financing. I doubt your claim.

And I have never encouraged people to do ASB roll over, that is you putting your words in my mouth, stop being filthy, but they are free to do so. So who is the one who is trying to stop people from exercising their rights to think for themselves?

Finally, I'll just have to mention that your questions are incomplete, you tried to set me up but you didn't have enough knowledge to even ask the proper questions.

This post has been edited by wild_card_my: Aug 24 2018, 08:53 PM

Nope, you didn't mention the insurance cash value. I did not ask for insurance cost, I asked for the cash-value of the insurance. Not only you are ignorant, do you have reading comprehension issues as well? Can't tell "cash-value" from "cost of insurance"? Do you even know what it is? For someone who claims that he reads everything, how could he miss out on the insurance cash-value really is? Like I said, I doubt your claims, you probably read a few articles online and decided that it is game time. You can't even understand the benefits of refinancing the ASB-financing when the market interest rate is favorable, what else can we say about you? The true gullible?

You question, as per what I quoted below has NO cash-value information. Without knowing what the cash value is, it is difficult for me to give an exact answer, and I like giving exact answers because I always back my assertions and arguments with numbers and calculation, unlike you despite claiming to have been "dabbled in some investments". Just so you know, the cash value is NOT the cost of insurance. Now I have proven that:

1. Your question was not complete, thus there was no way for me to answer it
2. You wasted your time reading all those terms if you missed out on something as simple as cash-value of the insurance policy
3. You can't tell the difference between cash-value from the cost-of-insurance (which is the wrong term by the way, we call it PREMIUM or CONTRIBUTION, cost-of-insurance is not what you are referring to. Terms, get some: INVESTOPEDIA

You are probably the gullible that you made fun of in your earlier posts

For your education, this is what I meant with the cash value:



Where is the cash-value amount? When he closes this account to take up a different financing for his ASB, he would have his ARTT surrendered and received his units partially.

This post has been edited by wild_card_my: Aug 24 2018, 09:10 PM

Caught you lying again. I have been asking for the cash-value since the beginning, and the fact that you have been claiming that you have provided it (mistaking cash-value for the insurance premium/contribution) really says a lot about your character. Why would you lie about what other people have said and what you have posted? Please do not lie to cover your tracks, all these things are posted and I have quoted you. Best thing to do for you now is to admit fault.



This post has been edited by wild_card_my: Aug 24 2018, 09:19 PM

I suggest checking my calculator below, it has the exact answer to your question, and since you can edit the monthly minimum balance, you can never go wrong. You can edit the yellow cells. This is made exclusively for ASB/ASB2 because of its nature of dividend calculation:

1. based on the monthly minimum balance
2. dividend declared at the end of the fiscal year, with fixed unit price that doesn't fluctuate at all

I made one just now, try it and see if it is to your liking: Faiz Azmi's ASB dividend calculation for the year

This post has been edited by wild_card_my: Aug 25 2018, 12:59 AM

It depends on the bank, I cannot advice without looking at your offer letter in full. You can share it if you want, 5 minutes into reading it and I can let you know. Plus banks have different terms even within the same banks, like mortgages for MBB of which there are 3 mortgage products just from the same bank

Be careful, not all banks have flexi-facility in their loan accounts. If your financing has no flexi-facility, the money that you put into your account would be put into the loan and used to repay the remaining balance of the tail-end of your tenure, not front-loaded and used to reduce the principal. All I am saying is that without reading the LO in full, it would be dangerous to blindly give advice on this. For mortgages, Al Rajhi is known to do this - that is to put the "advanced payment" into the tail-end of the financing tenure.

1. I assume that you do not have any ASB-financing right now. If so, you can do so today or at anytime in the future, as it is though, the current best rate is 4.85% p.a as shown above. If you are worried about the dividends, you will still get the dividends for September to December.

2. For those who are worried about the current financing taking too long to be redeemed by their current bank, I can say for sure that I managed to get my client to completely close his MBB ASB-Financing account in 10 days since making the application, as shown in the screen shot below. He applied for the cancellation at a branch on the 7th, received a call about the receipt of request for cancellation on the 9th, and on the 17th his ASNB account reported the units having being fully sold back to ASNB.

3. In this case, if you were to apply for the cancellation, the units may be fully sold back in the 5th of September. In about another 10 days, the new units would be bought from a the new bank. You would lose 1 month's worth of dividend, which is for September, and still earn the dividends for January-August (8 months) and October-December (3 months), for a total of 11/12 months of the year. Your dividend received in January next year will reflect that.

4. I must claim though that the situation above is on best-effort basis, and I cannot guarantee that everything will happen smoothly, but I always try my level best for my clients

There are so many Hafizs' in the world, so I can share this without any censorship.


This post has been edited by wild_card_my: Aug 25 2018, 09:31 PM

ASB/ASB2 performances can be unpredictable, because the fund does not disclose the outstanding shares held by the public. So we don't really know its actual NAV per unit. You could be paying RM1 per unit, but the actual NAV per unit could be anything. In short, we know the funds total NAV, but without knowing the number of outstanding shares, there is no way to calculate the NAV per unit

As we know with unit trust funds (ASB is a unit trust fund, but a fixed-priced variety), any distributions given would be taken out from the NAV itself, i.e even if you do receive the distributions, the NAV per unit would take a hit, and your nominal holding in the fund would not change; it is as if you took money from your right pocket and put in your left pocket, the amount of money you have is still the same.

With ASB, the dividend declared can be anything that does not correlate with the actual performance of the funds. Notice that during profitable years ASB declares about the same positive dividends as during the less profitable years, unlike equity unit trust funds (of which ASB is also heavily invested in equity) which has positive and negative returns throughout their lifetime (although most have positive annualized returns if we go back at least 10-years back)

This is because ASB was created with Malays/Bumi (but more to Malay Muslims) in mind that is:

1. They do not like the daily changes of unit trust NAV per unit prices. If they put in RM10,000 today, the capital has to retain its value in 1, 5, or even 10 years. They do not like losing the capital. Which also explains why there is no "sales charge on ASB unlike unit trust funds that charge about 5.5% as a sales charge"

2. They do not like getting negative returns

Due to the nature of these 2 groups, ASB was designed where during profitable years, some of the returns are kept in reserve, and during losing years, the reserves are used to maintain a somewhat consistent levels of dividend.

To verify this, check out the companies that ASB is invested in (Malaysian blue chips), and compare its performance to the other unit trust funds out there. ASB: consistent, low-positive returns; Unit Trust: inconsistent, a mix of positive and negative returns (based on the NAV/unit) through out the years.

This post has been edited by wild_card_my: Aug 29 2018, 11:36 AM

http://www.asnb.com.my/v3_/pdf/produk/ASB/2017_AR-ASBASN.pdf

Check page 35. You can see all the blue chip Malaysian companies are there. ASB invests in the same companies as other local equity funds from the likes of Public Mutual, CIMB Principal, etc.

The only difference is that while these other funds are giving a mix of positive and negative returns, ASB is giving consistent dividends, due to the fact that I mentioned above

Yes I was with a few banks, namely CIMB as an RM. As an RM I had to handle all sorts of needs from the banks' clients, including, but not limited to financing (mortgage, ASB financing, cc) as well as deposit products (FD, foreign currency), and direct investments in our unit trust accounts (cimb principal and funds under CWA's wings). Not to mention their insurance needs (sun life)

As time goes on, one has to focus and I decided that mortgage (and to some extent, ASB-f) are the way to go, with insurance coupled in to cover the mortgage

We are off topic here so let's get the discussion back on track to ASB and ASB-financing

Yes, you are correct. if the money is not disbursed by the new bank and ASNB deposits the money received to your ASB account by august, the minimum balance for August and September would be 0

Rebates are not... err.. corruption meh? Kickbacks. I suggest to do so in the down low and not in the open.

No, it is not to be taken lightly. I couldn't give direct rebates to the clients back when I was with CIMB as an RM. There are promotions, but these are sanctioned by the banks and not out of my own pocket.

Don't be too sure about this, people's jobs are at stake here. Insurance companies have policies against such "rebates". When I was with CIMB, I was not allowed to give unsanctioned "rebates" to my customers. These sanctions may have been partly due to BNM's policy, the particular bank's policy, or even the branch and/or team that that the employee was attached to. You can't just drop an anecdotal experience and blanket authorize everything especially when you don't have much at stake - you are just the consumer.

For banks like Al Rajhi (which I also worked for) one would be sent for disciplinary action if he offers "rebates/presents" as a condition to take up any of their services. Al-Rajhi's policy, driven by their shariah compliance dictates that they can't ask the prospects to sign up for anything (not even for savings/current account) as a precondition to give them a present (even a pen). If they want to give a pen, they can give, but not with a precondition to take any services

I was not wrongly chastising you, because I was right and backed my assertions with numbers, figures, definitions, statements, and more. My suggestion to OP was to perhaps not do it in the open; or a the very least verify with the employer on this. Will you take responsibility in the event that someone is negatively affected due to listening to any of your untethered advices? Of course you won't, because you are taking this as if it was a game, while to them these are their livelihood.

Finally, if you can't take it don't dish it. No need to talk behind my back about it. I can take it however high or low that you want, because I have the experience working in these positions to back myself up - my statements are not anecdotal, because I am the source as I have worked in these positions.

Not necessarily. Please check your ASNB account statements (it may not be updated yet) as to the date your units were bought by the bank on your behalf.

You eligibility increment is increased as you earn the dividends, there are no limits when it comes to earning the dividends. So the question is, currently how much in the account is based on ASB-financing?

Congratulations.

Quite obvious isn't it? 11am.

Your post is accurate, although I need to double check with my sources soon on the DSR table. If I am not mistaken, for the minimum DSR of 60%, it is based on net income of RM3,000, not gross income of RM3,000. Things may have changed or I may have forgotten a few things. Will get back to this

But as a whole your whole post is accurate, including the DSR calculation

It applies to other banks as well, except for RHB which sometimes only take 50% of the variable income as part of the applicants' income.

This is out of topic, but Prudential BSN Takaful still has medical cards that start from RM120/m~ for adults below 30. I would know. BUt any discussion of this sorts should be done away from this thread.

This post has been edited by wild_card_my: Sep 1 2018, 02:18 PM

Links? Er I do not usually do links, would prefer to explain in person or through a personal channel. I will have to hold this discussion away from this topic though, because we are going tangent.