there will most probably be a cancellation charge. So see whether is it worth or not la, if the savings > cancellation charges, then still ok. That is why it is always a disadvantage if you only go to 1 bank to ask for loan.

In our case, we don't promote any banks but 1 application is sent to our 10+ panel banks (local & foreign). So one shot you get all the banks reply then you can decide for yourself. So cases like your brother can be avoided. Anyway current the lowest rate is BLR - 2.5% ie. 4.0% so if any bank is offering higher, then you know that is too much already. Ask your brother what is the offer he is getting at the moment?

This post has been edited by DannyOP: Dec 18 2008, 02:12 AM

since CIMB replied late, just ask your brother to tell them that if they still want his business, then ask them to absorb the penalty charges. Your brother did not do anything wrong since everyone in his same shoes also would have picked the bank with the lower interest, in any case 2.2% is still not that good offer.

Now he has 2 choices :-

1) Stick with CIMB and bear the penalty charges from Alliance
2) Change bank and bear the lockin charges

I would think since he has chosen Alliance, even at BLR - 2.2% it is still a good offer compared to his previous loan. Actually he does not lose out, just that he might have missed the opportunity to escape the lock-in charges.

This post has been edited by DannyOP: Dec 18 2008, 10:24 AM

not true, when you sign the application form for certain banks there is a clause stating the penalty charges upon cancellation.

This post has been edited by DannyOP: Dec 19 2008, 02:03 PM