KLIBOR is currently at 3.61
BLR at 6.75

Standard Chartered has a KLIBOR based loan
KLIBOR + 1.50 (year 1 - year 5)
KLIBOR + 1.0 - after that

my question is
all things being equal

How is KLIBOR related to BLR?
KLIBOR + 1, then BLR also + 1 ?

Hmmm .... KLIBOR ..... first time come across this .... anyone can help answer TS's question?

klibor or kuala lumpur interbank offered rates. It is the interest rate that banks borrow at. This defines cost of funds and also interest rates for FD.

KLIBOR, OPR, and BLR r all closely linked.

so
if BLR increase by say.... 1%?
KLIBOR should increase around 1% too, right?

Roughly, as they are tightly linked. But can be differ sometimes in the degree of rise or drop but not much. Like last time, KLIBOR only rose about 0.3-0.4%, but BLR went up 0.5%.

for the untrained eye, KLIBOR based loan sounds better than BLR based loans..

Fuel hike --> no immediate rate hike, just talk. So you know BNM intention and banks know it

i don't understand

KLIBOR is a lot more transparent as the KLIBOR fluctuates on a daily basis. It means you could end up paying few $$$ more OR less every month.

However, in most instance, think u'll save more as BLR is the "marked-up" value of KLIBOR.

well in economic terms, when there is over inflation, governments will increas interest rates to slowdown spending thus limiting inflation. Then when there is deflation like in jpaan during early 2000, also in singapore, interest rate or BLR was at only 1-2%. Japan had a 0.2% interest at the lowest point and FD was -0.35% they wanted people to stop saving and start spending.

KLIBOR is monthly rest, paying more will cause u a headache

how about if we have high inflation but the economy is very weak, dont seem like the right solution is to increase the BLR, but also need to do something to cool the inflation rate.

I'd rather have higher inflation rather then kill domestic sentiment by raising BLR

yes KLIBOR will move in the same direction as BLR but they don't have the same momentum.
Eg if BLR increase 1%, KLIBOR wont increase 1%.

Yes this product will reset its KLIBOR rate every quarter yearly but i don't think it will cause any headache coz the installment amount will be the same. Just the interest paid will be different. Please correct me if i'm wrong, i haven't look into detail about this matter. But its not logic if every quarter i have to pay different installment amount. Too troublesome.

Please take note that KLIBOR doesn't ALWAYS lower than BLR. Historically it has been higher than BLR before but its a very rare situation.

KLIBOR also more fluctuate than BLR thus will have higher uncertainty thus more difficult to calculate project NPV (net present value) for your investment decision.

However at this moment, I will not consider term loan. I prefer flexi loan. In this uncertainty economy, cash is king, not profit. Thus if you have more liquid cash, u will have more room/flexibility to play around with ur cash.

what is the current klibor rate ?

http://bondinfo.bnm.gov.my/portal/server.p...874&cached=true

2.14 as of today

to me, housing loan based on KLIBOR is very attractive....

Overall its likely that a KLIBOR tagged loan will be slightly better. Probably not a very significant impact on your monthly repayment though.

However the downside is that your interest rates and repayment will change every quarter based on the package SC is offering. A BLR tagged loan would be more stable and predictable.

Mind to tell why KLIBOR is better? From the comparison, BLR base home loan is much more attractive in terms of rate.