Is it compulsory to pay for MRTA (mortgage insurance) when loaning from bank?

sgcount said:

I was told recently it is compulsory to pay for the MRTA mortgage insurance when we take a loan from the Malaysian banks.

Does any of you know if there is any way not to pay this? Or are there alternatives as not everyone needs the insurance.

Thanks.

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sgcount said:

I was told recently it is compulsory to pay for the MRTA mortgage insurance when we take a loan from the Malaysian banks.

Does any of you know if there is any way not to pay this? Or are there alternatives as not everyone needs the insurance.

Thanks.

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Frodo said:

Depends on bank. For Standard Chartered it is not compulsory. For RHB it is.

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Funniman said:

MRTA is more to protect the bank loan in case the borrower die. It is to protect the backside of the bank.
It doesn't matter how much the margin is.

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Frodo said:

Depends on bank. For Standard Chartered it is not compulsory. For RHB it is.

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RedsYNWA said:

Yes, Std Chart not compulsory but they may charge 0.05% higher. That's what they told us when we said we don't want MRTA but eventually, they still gave us 4.2% instead of 4.25%.

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sgcount said:

Thanks all for the reply.

I thought the MRTA is to protect the family should home buyer can no longer pay the mortgage. Cos for the bank, if that unfortunate situation take place, they just take back the property and sell it?

I've just been told again by the bank it is compulsory regardless of anything. Sighz. So it's not consistent.

Wah, Stand Chart so good? UOB is charging 4.3% with MRTA!

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kopikong99 said:

From my experience, only Maybank insists it is compulsory while UOB, OCBC and CIMB is optional.

I remember the premium is high and given the choice, I would not want this MRTA.

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sgcount said:

Thanks all for the reply.

I thought the MRTA is to protect the family should home buyer can no longer pay the mortgage. Cos for the bank, if that unfortunate situation take place, they just take back the property and sell it?

I've just been told again by the bank it is compulsory regardless of anything. Sighz. So it's not consistent.

Wah, Stand Chart so good? UOB is charging 4.3% with MRTA!

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kopikong99 said:

From my experience, only Maybank insists it is compulsory while UOB, OCBC and CIMB is optional.

I remember the premium is high and given the choice, I would not want this MRTA.

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sgcount said:

I have a feeling the bank (and/or insurance company) is just trying to suck money from us. :(

I'm getting some conflicting news. Now I'm also told for UOB it is compulsory. Last time, Public bank was not. But malpaso you were just told it is?

Frodo, thanks, but only 2 selected banks on my list. The other banks won't finance. Another weird thing I don't understand about Malaysian bank loan.

Their rules seem to keep changing. :(

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malpaso said:

yes, i was definitely told by pubic bank i need an MRTA. maybe i looked very poor to the banker, was wearing shorts and slippers. however, that was in june 2013, not recently.

and everyone is trying to suck money from us. amazed you didn't notice that??

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sgcount said:

I was referring in particular to the MRTA case. Cos it should be an individual's choice whether they take it or not. If they can't pay it, the bank takes back property to sell. I don't see how the bank can ever be disadvantaged if one does not have MRTA.

MRTA is good but only for those who need it. To make it compulsory doesn't make sense except for making $ for themselves.

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Frodo said:

Indeed it is a money making ruse for the bank in my view. The bank really doesn't need it since they can take possession of the house in the event you cannot pay up, regardless of whether you are dead or alive. You buy and factor that into your loan you end up paying interest on that over the loan tenure. How come only 2 banks on your list? You already tried StanChart?

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sgcount said:

Yeah man... if they can take advantage of us, they will! Previously, I was told there's a RM500 loan processing fee for foreigners. Oh man... this they also wanna take. Now this MRTA thingy comes up. I was shocked when told it's compulsory.

I'm also not sure why not all banks can loan. It seems this is the way they Malaysian banks work. Before taking any loan, the bank will ask what property it is, the name and location. I don't understand this also.

Sometimes, people tell me, remember this is Malaysia! Things work differently. That's what they mean "Malaysia boleh"???

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