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 Pay extra every month or one lumpsump, Clear off house loan

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eagle.ng
post Jul 2 2008, 05:05 PM

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QUOTE(cblau @ Jul 2 2008, 04:33 PM)
It is make me very very confusing..... sad.gif
is it good or not? mean Alliance Bank just reduct that particular interest on that month?
Or should we find the loan which is only one Home Loan Account rather than 2 account (Home Loan account and Current account)?
what is the different if our daily interest reduct from our Principal Loan instead keep in Current account(Home Loan).?
Can anyone explain more? blush.gif
cblau
post Jul 2 2008, 05:52 PM

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QUOTE(eagle.ng @ Jul 2 2008, 05:05 PM)
It is make me very very confusing.....  sad.gif
is it good or not? mean Alliance Bank just reduct that particular interest on that month?
Or should we find the loan which is only one Home Loan Account rather than 2 account (Home Loan account and Current account)?
what is the different if our daily interest reduct from our Principal Loan instead keep in Current account(Home Loan).?
Can anyone explain more?  blush.gif
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As long as its flexi regardless of whether one a/c or two a/c it already saves you interest. It just that different bank has different method of setting up their flexi loans. If you have time you read a couple of more times the post again and you would understand the way it operates.
smcg
post Jul 3 2008, 02:36 AM

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geekine90,
loan : 100k
current acc : 100k
interest : 0% ( exp: normal 6%, bcos of the 100k in current acc, so 0%)
repayment : rm600 monthly
tenure : ?? ( 100k / 600 = 167months settle )
outstanding : ?? ( exp: already paid 10mths, means 100k-600*10 = 94k )

is this the calculation u doing?
i was thinking that way also, but the truth isn't that.. although the statement v receive monthly is written that way ( interest charge ).. but the outstanding still remain like conventional loan. u can try 2 check it out.

This post has been edited by smcg: Jul 3 2008, 02:45 AM
GeekinE90
post Jul 3 2008, 11:47 AM

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QUOTE(smcg @ Jul 3 2008, 03:36 AM)
geekine90,
loan          :  100k
current acc :  100k
interest      :  0% ( exp: normal 6%, bcos of the 100k in current acc, so 0%)
repayment  :  rm600 monthly
tenure        :  ?? ( 100k / 600 = 167months settle )
outstanding :  ?? ( exp: already paid 10mths, means 100k-600*10 = 94k )

is this the calculation u doing?
i was thinking that way also, but the truth isn't that.. although the statement v receive monthly is written that way ( interest charge ).. but the outstanding still remain like conventional loan. u can try 2 check it out.
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The outstanding amount reduces by the full monthly installment amount each month when the auto deduction from current account happens. Previously, a portion goes to interest, and another to the principal to reduce the outstanding amount. Now 100% goes to the principal and 0 goes to interest. Basically, the outstanding loan balance amount now reduces pretty fast as fast as your current account reduces heh. For my case I don't get charged for a monthly fee as well for current account. I believe there is a small yearly service charge like normal current accounts, but I haven't noticed it (gotta look through past statements to confirm). My flexi loan is with Citibank btw.


smcg
post Jul 3 2008, 07:05 PM

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QUOTE(GeekinE90 @ Jul 3 2008, 11:47 AM)
The outstanding amount reduces by the full monthly installment amount each month when the auto deduction from current account happens.  Previously, a portion goes to interest, and another to the principal to reduce the outstanding amount.  Now 100% goes to the principal and 0 goes to interest.  Basically, the outstanding loan balance amount now reduces pretty fast as fast as your current account reduces heh.  For my case I don't get charged for a monthly fee as well for current account.  I believe there is a small yearly service charge like normal current accounts, but I haven't noticed it (gotta look through past statements to confirm).  My flexi loan is with Citibank btw.
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if u say u never get charged except for the monthly service, then the calculation will be same like what i post. which means the money u pay for your installment should b 100% deduct ur principal loan amount. but anyway, if u got time, maybe u can go to citibank n check ur outstanding balance instead of just referring ur past statements, then maybe got some different. cos any question, u can ask them on the spot.
anything just pm me..

This post has been edited by smcg: Jul 4 2008, 12:49 AM
GeekinE90
post Jul 4 2008, 09:38 AM

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QUOTE(smcg @ Jul 3 2008, 08:05 PM)
if u say u never get charged except for the monthly service, then the calculation will be same like what i post. which means the money u pay for your installment should b 100% deduct ur principal loan amount. but anyway, if u got time, maybe u can go to citibank n check ur outstanding balance instead of just referring ur past statements, then maybe got some different. cos any question, u can ask them on the spot.
anything just pm me..
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Well the outstanding loan amount is clearly printed on each months statement. It reduces by 100% of the monthly installment payment monthly. So its pretty clear what happens to the outstanding loan amount each month. Also I've confirmed that there is no monthly service fee that I get charged for. My experience with flexi loan has been great. I just hope that with my track record of denying the bank from making lots of interest $$ from me, that future HP loans I apply for wont be impacted. blush.gif
smcg
post Jul 4 2008, 11:16 PM

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QUOTE(GeekinE90 @ Jul 4 2008, 09:38 AM)
Well the outstanding loan amount is clearly printed on each months statement.  It reduces by 100% of the monthly installment payment monthly.  So its pretty clear what happens to the outstanding loan amount each month.  Also I've confirmed that there is no monthly service fee that I get charged for.  My experience with flexi loan has been great.  I just hope that with my track record of denying the bank from making lots of interest $$ from me, that future HP loans I apply for wont be impacted. blush.gif
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thank's for sharing.. may i ask u something.. according to your calculation, how many months u think u can settle the loan??
my sister-in-law also using citibank flexi loan. but the monthly statement he pass 2 me and the inquiry from citibank is totally different (outstanding amount).. that's y making me so confusing n doubt the bank charging... i'm actually looking someone who loan 100k n dump in 100k to clarify the problem.. since u r doing that way, can u do me a favor?? get the inquiry from citibank beside referring the monthly statement to prove our flexi loan calculation is correct.. thumbup.gif
bafukie
post Jul 5 2008, 11:04 AM

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interest is calculated on daily basis isnt it? using financial calculator... u will save more by paying more monthly compared to one lump sum after a period of time.
GeekinE90
post Jul 5 2008, 08:16 PM

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QUOTE(smcg @ Jul 5 2008, 12:16 AM)
thank's for sharing.. may i ask u something.. according to your calculation, how many months u think u can settle the loan??
my sister-in-law also using citibank flexi loan. but the monthly statement he pass 2 me and the inquiry from citibank is totally different (outstanding amount).. that's y making me so confusing n doubt the bank charging... i'm actually looking someone who loan 100k n dump in 100k to clarify the problem.. since u r doing that way, can u do me a favor?? get the inquiry from citibank beside referring the monthly statement to prove our flexi loan calculation is correct..  thumbup.gif
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Actually the number of months till you settle the loan totally flexible. If you look at the statement, the calculation will be:

Outstanding amount - monthly principal deduction = New oustanding amount

Number of months will be outstanding amount/monthly principal deduction

But its not so relevant as you can settle anytime if you wish.

Attached is my flexi june statement which I hope makes things clearer for those who are opting for flexiloan.

Btw. The 0.12 interest i got charged this month is because I used the current account to make an instant online payment for my credit card and then topped up the current account with a check deposit to avoid credit card late fee (lost track of time last month heh). So that was like a 1-2 day gap where by current account balance droped below the loan amount. Else its usually 0.00 instead for interest.

This post has been edited by GeekinE90: Jul 5 2008, 08:20 PM


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firesphere
post Jul 8 2008, 05:54 PM

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From: Kota Kemuning / Shah Alam / Subang Jaya / KL
QUOTE(knwong @ Jun 26 2008, 11:11 AM)
Too bad I'm taking conventional loan. Not a flexi-loan.
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According to BNM's statistic, conventional loan save a lot more than flexi loan. Imagine you have 100k in your account and your car is acting weird, breakdown a lot, will you endure the agony of a frustrating car or sell then buy a new car? Yes, conventional you can withdraw but the hassle of 1 week notice and RM50 per withdrawal will force you to do it when you really need to. But Mr. GeekinE90 is special case though.

 

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