In view of the current loan rates offerings (BLR - 2.X), it is still wise to withdraw our EPF money to reduce the loan amount ? or is it better for the EPF money to be sitting there collecting the annual dividen of 5.X % ? anyone did the calculations lately ?

Take it out and put in ASN or BSN

or spend it

IMHO take it out while you still have the opportunity if you're later strapped for cash the option to take out a large lump sum from EPF is gone.

I dun think u can simply take it out ler
Not sure about using it to settle loan but for buying new property it goes directly to the lawyer (stakeholder) which will be passing it to the developer so it won't be up to u whether to pay a portion and keep some

Bro n73me I think if u're thinking of invest y not use the epf acc3 money as downpayment for another new property???
Better investment lerr

i agree with you, i am hunting for more property but just that it came across my mind that i have some money in the epf that i could utilise, but not sure whether to keep it there or take it out...

I also planning to take out EPF to reduce my loan principal. But my wife and PBB agent keep advising that EPF interest is higher, better don't take it out

Correction... EPF banks the money directly into your account... after that n73me can do whatever he wants with the money.

At least it was true for me unless EPF changed the rules recently.

I also caught in this situation. I have a house with outstanding bank loan of Rm 180k with 6.25% flat interest with pay back term of about 12 yrs left. Monthly installment is 2k/month. I am thinking of

a) take out the EPF to reduce the loan
b) refinancing with lower BLR (with 4% penalty pay to bank)
c) increase monthly installment to cut short pay back period and save on interest payout.
d) simply sell the house (worth 260k now), move back with parents and wait for property to crash and buy back with cheaper price.
e) stay put and do nothing
f) none of the above. (please share your ideas)

What should I do?

BTW, my last EPF withdrawal is direct bank into my account, I dunno about now. If bank into account, is it a good time to buy shares?

This post has been edited by KLsooner: Oct 24 2008, 06:13 PM

when I was still with my previous company (developer) I handled a case for a purchaser where he withdraw epf acc3 as downpayment...
Basically he can't just take all the money, the amount of downpayment have to tally with the amount he wants to withdraw...
So say EPF acc3 have RM20k, your downpayment have to be RM20k to fully withdraw...
And money was not sent directly to his own bank account.
The money will be going to the SPA lawyer and then to the developer...
As far as I know that applies to property under construction and completed property...

I'm not sure about withdrawing money to settle outstanding loan principle but I think the money will be paid directly to the bank involved also not into your personal account...
Pls correct me if i'm wrong

as i know last time if u signed the s&p then only u can ask for the epf money, the money will go to ur account coz thr no bank yet for ur loan.
but if epf withdraw for the existing loan, the money will go to the loan bank..
since the new system that say u can take for monthly payment, im also not sure anymore,
some say that u can take the epf for the second property,
are this true?

EPF is returning around 5%. If your loan interest is greater than your EPF returns, it is better to withdraw from EPF to pay the loan..