hi got a noobie question here.

Want to ask which option is better
a) I want to take a 200K loan using my relative's gov house loan allocation. He's 55 so the insurance for getting the loan is very high. If I'm not mistaken its above 50K for the MRTA.


b) Take bank loan 200K using own name. My MRTA is less than 5K.


According to my calculation,
option a) I will actually be loaning 250K at 4% interest for 25 years.

option b) 205K at 6% interest (assuming i get those fixrd rate loans) for 25 yrs.


It seems like option b) I'll be paying like 1300/mth but option a) is 1400/mth.

Is my calculation correct or am i missing something. I thought gov loan is always better than bank one ?

A 55 years old can loan 25 years? Im not so sure about that..

Government loan you need to pay RM1,319.59 (4%) and commercial loan you need to pay RM1,320.82 (6%) if the MRTA is at 5k.
So if you take out and pay separately for the MRTA (RM5k), your monthly repayment becomes RM1,288.60

Now you decide.
Bear in mind that it's harder and a rather complicated process in transferring of deeds and tittles from one to the other.
So overall, I would still recommend loaning using own name.

touch wood saying, if ur relatives doesn't live 25yrs, then u may benefit from the MRTA.

other wise , i will go for my own loan.

tis is the most troublesome part.. but if TS doesn't mind about tis..then go ahead... since the loan is much more cheaper..

JS5016,
I dont get why is the gov loan much cheaper when the monthly installment only RM1.23 less ?

I agree, 50k MRTA is crazy!

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I'm was also deciding whether to go for gov loan using my wife's name (cos she's a teacher) or opting for commercial bank loan using both our name - so slightly different from yours.

In the end we decide to go for bank loan instead because gov can take ages to release money to our developer - we will get fined by the developer. Total spent can be higher if the gov delay the money release so for security reason we opt for the bank

gov loan...y not use it later? the longer you work, u will be eligible for a higher tier amount....though once only....4% even after you are out of service is unbeatable.

I also have this intention of using the gov loan for my second property purchase next time. Maybe during the next recession time when the BLR increase