Hi all, I'm planning to refinance my home loan recently.

I had been servicing my current home loan for about 2 years (out of 30 years tenure), with the interest rate of BLR - 0.8%.

It is still in the lockin period of 60 months, meaning that I will be charged with penalty of 3% out of the total loan amount if I refinance now.

From my surveys recently, I can get around BLR - 1.80% for Non Zero Entry Cost package for loan amount of RM110K (my outstanding loan amount).

Do you think it is a wise move to refinance now? Or should I wait until the lockin period is over? Please advice. Thanks in advance!

This post has been edited by sandswift: Oct 28 2008, 10:19 PM

Pai: that's a good idea! How come I never think of that?

falcon867: Thanks for your advice. I will try to re-negotiate with my bank after i got the loan offer letter from other bank.

ed0gawa: Yes, your assumptions are all correct! I had made a rough calculation:

Penalty (3% of original loan amount): RM3700
Legal fees: None (If I get ZMC package)
Current MRTA to be forfeited: RM1200
--------------------------------------------
Total lost for refinancing: at least RM4900

My suggestion? Take the 5% fixed rate IF they do not increase the lock in period furthermore. <-- Recently I asked my current bank about increasing my installment amount, they told me that they will need to start the lock in period again, back to 60 months.

Anyway, my relative is trying his best to get BLR-2% for me. Or I will wait until my lock in period finish first. By that time, I hope the BLR will be going down.

Are you sure MRTA can be transferred to the new bank? I thought MRTA is non-transferable? AFAIK, only MLTA is transferable. Please correct me if I'm wrong.