This is why, as per the above case, I had to cancel the application and reapply it. This bank revised the BR by 0.1% on the 10th of this month. For all the clients who have not had their loans disbursed, I had to go through the trouble of reapplying on their behalf.

For example, assume that the BR for this bank is 4%

1. Any applications submitted BEFORE the 10th of January is given a rate of BR + 0.85%. At the time when BR was 4%, the effective rate for this customer is 4.85%. But the bank's BR was revised upwards by 0.1% to become 4.1%, so their effective rate became 4.95%.

So for these customers, I would cancel the application even those that have already been approved but not yet disbursed, and reapply on their behalf to get to point [2]

2. Any applications submitted ON and AFTER 10th of January is given a rate of BR + 0.75%. The BR at that date is already 4.1%, so their rate is maintained as 4.85% as I promised them.

Unfortunately, for those who have already had their loans disbursed, I cannot help already. I am so sorry guys, the BR is beyond my control  :cry:  :cry:  :cry:

The bank that I was talking about for the increment of BR is not MBB. So I do not think you are affected (yet).

Your rate is likely 4.85% (check at MBB2U)

The cancellation I mentioned was done on behalf of my clients, before the loan was even disbursed, and reapplied to maintain the 4.85% rate. If I do not do this, they would get 4.95% which is not what I promised them

I can't help for those who already have their loans disbursed. If you are currently on a higher rate (for example, 5.25%), then you may consider cancelling yours and reapplying for a new 4.85% rate of today. But that is different than what I did for my clients who has not had their loans disbursed yet.

Put it this way. At RM200,000, the takaful for that bank is just RM400.

Option A
Loan: RM200,400
30 years
4.85%
Installment: RM1,058/m

Option B
Loan: RM200,000
30 years
4.90%
Installment: RM1,062/m

From the savings you get on the installment it is clear that option A is much better. A lot of my clients are taking this bank for their ASB-(re)financing, be it new application or refinancing from other banks, and this is the answer that I give them. Essentially, that RM400 takaful is "useless" as a takaful, but you are not taking it for the takaful itself but to reduce the rates.
 
Takaful in itself is important to cover your liabilities:

a. you may want to leave (due to premature death) your beneficiaries with a good sum of ASB-assets without the liabilities/financing that need to be served

b. nor would you want to live while incapacitated (from total-permanent-disability) and have to cancel your ASB-financing retirement plans/strategy due to being incapable of working

However, the better option would be to take it from an external party, with you being both the person-covered and the policy-owner - note that I am giving this advice as an impartial entity given that I am also an insurance/takaful agent, but my argument is sound, backed with years of experience in the industry and some figures/numbers to boot. This is because over the course of the next 30 years, you will be refinancing the ASB-financing multiple times. If you had taken a takaful policy from the banks' sister companies (Etiqa, Maybank; Sunlife, CIMB), the policies would be absolute-assigned to that bank, meaning the bank owns the policy.

When the bank own the policy:

1. they will force-surrender that policy upon loan cancellation/settlement (when you want to refinance your ASB-finance). If you choose to continue to protect your liability in the form of taking up a Takaful policy, you would need to resubscribe to a new policy from another provider a few years from today, which would be more expensive as you would have aged (premium is determined by age, among other things)

2. they will not allow you to cancel the policy if you decide to have a liability takaful of your own later in life, unless you cancel the loan.

Yeap. As you bought the policy with their sister company or partner, they would insist that the insurance is absolute-assigned to them (the bank). The only way you can surrender this policy is you make the settlement/cancellation of the loan through:

1. settlement (by paying off the balance due)
2. cancelling the loan, and have the capital pay the bank balance (including the loan used to purchase the policy)

You can't carry the takaful over to new loans either, the bank would force-sell the policy. You will get the surrender value at a later date. My simple advice if you still want protection would be to take a policy/takaful that is on your name, and own it.

Yes you should.. Though they probably mailed you a letter explaining the increase beforehand. I know public bank does send physical letters to one's address to inform about a change in terms and why.

Where do u apply your asbf? At the bank? That is a misconduct if the banker doesnt told you about the rate in asbf. For your info the rate in asbf is floating rate. Meaning if the base rate, BR increase your rate also will increase. The only remain in your loan is the bank spread.

For example BR 4.15% spread + 0.85% = 5.00%
When the BR increase to 4.25% than your new rate will become 5.10%.

However at cimb bank if the increase of the payment is not more than RM50 after the new rate, the payment remain.

About the effect if the rate is increase either your payment increase or remain. If remain, your principal value will be lesser and the loan tenure will be extend.

Hope this well help you to understand about the rate in asbf. Its the same rate use in housing loan too.

Yeah..it is normal. BR can go up and Down..you don't have to worry too much but you can option to change the facility if in your case the interest already shot up to more than 5.2% coz it is expensive. (Better u check it)

Your monthly payment would not change but your repayment portion to the loan would be much2 lesser as bank take more interest from it.
So, you can replace it with cheaper offer now like 4.85% lowest in the market so u can save more on interest. Ask me more if u want to know

As for the takaful quesitons:

1. in general, you don't really need the takaful except to reduce the rate if required (4.75% with minimal takaful of RM400 one-off vs 4.8% without takaful at all, do the maths)

2. takaful is not really required because at any time of your loan tenure, the asset collateralized maintains its value of RM200k (for example), while your RM200k financing outstanding would be reduced over time

3. if you insist on the Takaful coverage, you may be better off taking your own personal life takaful that is attached to you and not the bank. Why, because when you refinance your ASB financing, you would have to surrender your takaful taken with the bank and have to take a new one. By then you would be older, and the takaful contribution rate would be more expensive - not to mention that there is no guarantee that you would be "healthy" - if you are not healthy your takaful application would be rejected or comes with riders/exceptions

4. There are cheap personal takaful too, you just have to know where to look.

As for your split 200k  questions:

1. it doesn't matter to "us" service providers, but it matters to you because you would have to pay RM60 (endorsement and stamping fees) per financing. 4 x RM60 = RM240

2. you would have 4 loan account numbers to keep up with, regardless of auto-debit
There are no hard-and-fast rule to refinance; my recommendation is to hold it for a few years and look at the market for the latest rates, and compare it to your own rates (your effective rate of today, not your original rate), as well as the "capital return" that you would have gotten back from the bank; with this information analyze and consider any advantages of refinancing

For example, after 5 years, your RM200k financing now has a balance of RM183k. Your rate is currently 5.55%. If you refinance to get a new RM200k ASB-financing, you would get RM17k back in cash (which I recommend that you dump into ASB2/3), and sine the best rate today is 4.75% p.a, you would save 0.8% p.a which is quite a hefty sum.

Do the numbers and decide for yourself.

You can withdraw any cash investments from any funds, just walk-in to the bank or ASNB branches to do that

Btw, was it ASB2 or ASM2? ASNB is the name of the Unit Trust Management Company, not the fund.

Can add online redemption or jualan balik to that list too.

https://ringgitplus.com/en/blog/investment/...via-myasnb.html

How can we actually do that?