Banking & Finance (includes credit cards posting)

[Mingchye]

Abit confuse here. Hope some kind souls help to enlighten me.

I approached bank A. I took 7 yr loan. But he told me 7 year loan mean i have to take 2 + 7 (9 year loan). First 2 year i have to pay interest during the construction period. Only when TOP or CFO then i start paying instalment plus interest for 7 yrs.

On the other hand, another bank B told me i can start paying my loan instalment plus interest immediately i.e. during construction period. Base on 7 year loan too. So its 2 + 5 (7 yr loan). This bank quoted me 7 yr loan of 7000 pm. Whereas bank A quoted me 9 years loan with same mthly instalment 7000pm

Question is how come both banks charges differently? Seems like Bank A cut throat!

The different package serves different purposes. Package from Bank A is suitable for investors who want to sell upon VP. For this group of people, minimal payments during construction is best. If the developer provides DIBS even better for them.

 

[wuqi256]

The different package serves different purposes. Package from Bank A is suitable for investors who want to sell upon VP. For this group of people, minimal payments during construction is best. If the developer provides DIBS even better for them.

Well put, its serving different sectors of the market so they package and market it differently. More and more developer don't provide DIBS or any form of deferred payment these days.

 

[myrsing]

Thks Wuqi and Mingchye.

I am sure there are reasons why different banks offer different packages. But having spent almost an hour with bank A, going through all my particulars and documents, he should already know that i am buying for home stay. Furthermore i kept emphasizing i dont like the idea of paying interest for 2 years and my instalment only starts from TOP. Cos instead of quoting me 7 yrs, hes quoting me 2 + 7 = 9 years loan instalment! He should give me other alternative packages ie. if there is.

May i know what is VP and DIBS?

 

[Mingchye]

Thks Wuqi and Mingchye.

I am sure there are reasons why different banks offer different packages. But having spent almost an hour with bank A, going through all my particulars and documents, he should already know that i am buying for home stay. Furthermore i kept emphasizing i dont like the idea of paying interest for 2 years and my instalment only starts from TOP. Cos instead of quoting me 7 yrs, hes quoting me 2 + 7 = 9 years loan instalment! He should give me other alternative packages ie. if there is.

May i know what is VP and DIBS?

Thats true lah. The Banker never recommend u product according to your needs. I agree you would feel frustrated.

VP - Vacant Possession. This term is used in the Sales and Purchase Agreement. Have a look at it next time when you get it. I am always very surprised and amused when ppl anyhow ask questions and say wrong things and the information can easily be found in the SPA. They just need to go and read the SPA to understand what their rights and obligations are. Taking a good 15-30 mins is really very useful to know what are the things you can expect and what you can do in the event of late delivery etc. I think I should charge people for explaining to them the stuff just to penalise them for not making the effort to read and understand a very important doc they are signing.

DIBS - Developer interest bearing scheme. A private scheme where the developer offers to absorb interest charged by your home loan during construction period. Developers offer between 0% to 100% as part of their package.

 

[myrsing]

Well put, its serving different sectors of the market so they package and market it differently. More and more developer don't provide DIBS or any form of deferred payment these days.

But the developer also smart. I am sure they would have include the DIBS into the purchase price.

Btw Wuqi, wondering if u or any kind bros open a thread on a "List of Abbreviations & Acronyms"? Newbie like me would know what seniors here are talking about? Eg VP, DIBS, NI, PH etc etc. Better still, put it in sticky.

 

[myrsing]

VP - Vacant Possession. This term is used in the Sales and Purchase Agreement. Have a look at it next time when you get it. I am always very surprised and amused when ppl anyhow ask questions and say wrong things and the information can easily be found in the SPA. They just need to go and read the SPA to understand what their rights and obligations are. Taking a good 15-30 mins is really very useful to know what are the things you can expect and what you can do in the event of late delivery etc. I think I should charge people for explaining to them the stuff just to penalise them for not making the effort to read and understand a very important doc they are signing.

DIBS - Developer interest bearing scheme. A private scheme where the developer offers to absorb interest charged by your home loan during construction period. Developers offer between 0% to 100% as part of their package.

Thks for the explanation Mingchye. But dont be so cruel lah to charge people.:o Some people, like me, only primary 6 education level. Hopefully words used in the SPA are not bombastic. Easily understood by layman like me.:(

 

[jblover]

Hi all,

Got a noob question to ask u guys.

1. I am already in my late 50s. Assuming i am taking a loan of M$500K. Mthly interest charge at 4.2%

2. Lets say I got S$100K in my retirement account earning at 4% pa. But i can withdraw S$50K.

My question is it prudent to withdraw S$50K and convert to M$ (assuming rate at $100 = M$2.5) and reduce my loan of M$500K? Or to just let the funds be in the CPF retirement a/c and earn annual interest of 4%?

Thank u guys.

 

[ginfreely]

Hi all,

Got a noob question to ask u guys.

1. I am already in my late 50s. Assuming i am taking a loan of M$500K. Mthly interest charge at 4.2%

2. Lets say I got S$100K in my retirement account earning at 4% pa. But i can withdraw S$50K.

My question is it prudent to withdraw S$50K and convert to M$ (assuming rate at $100 = M$2.5) and reduce my loan of M$500K? Or to just let the funds be in the CPF retirement a/c and earn annual interest of 4%?

Thank u guys.

I think it is good to take out and repay the loan since interest rate for loan higher. Unless there is mortgage insurance that will pay all remaining loan if anything happens.

 

[jblover]

I think it is good to take out and repay the loan since interest rate for loan higher. Unless there is mortgage insurance that will pay all remaining loan if anything happens.

Thanks ginfreely. I always thought since i am getting 4% interest earned on my RA, may be good to leave it there and get my returns upon reaching 62 or 65. The mortgage insurance only cover when one is in total disability or upon death. Only worry is partial disability, terminate by company, and left with no regular income.

 

[avelc]

Depends whether you are happy with the current conversion rate of 2.5. If you are, then consider reducing your loan.

Or buy another property in Msia with that 50k sgd as down payment. (Just joking :P)

My question is it prudent to withdraw S$50K and convert to M$ (assuming rate at $100 = M$2.5) and reduce my loan of M$500K? Or to just let the funds be in the CPF retirement a/c and earn annual interest of 4%?

 

[siacw]

ho do you view SGD future?

if you think SGD will rise further then better keep it in the CPF. who knows by that time $1=RM3.

 

[jblover]

Tks avelc and siacw. Will moniter the ringgit ex rate closely.

 

[Nicholas]

I'm a Singaporean and looking to buy a place in Johor. The Malaysia banks seemed to place a limit of daily deposit of 10k RM.
To pay for a 1M RM unit will means I have to make many trips or remit many times just to have enough money in my Malaysia bank account.

How do you guys pay for your unit? If going to a Singapore bank and buy a bank cheque in RM will the Singapore local bank use the big elephant spread for rates?

 

[Nicholas]

Continue..

Was told to use Singapore bank account to TT money over to my own Malaysia bank account.. would that means I have to suffer the bad FX offers by the Singapore bank? Is there a S'pore bank tt charges reasonable rate to do such fund transfer?

 

[Nicholas]

Continue..
How about using remittance service to send money to my MY lawyer representing me? Can the S'pore remittance companies be trusted with handling the relatively big sum of money? Which remittance co has the track record of doing things right for you folks?

Thanks in advance.

 

[myrsing]

Guys,

May I know any different buying MLTA or MRTA?

Thanks.

 

[potter]

Guys,

May I know any different buying MLTA or MRTA?

Thanks.

you may refer to http://www.nanyang.com/node/423965

 

[potter]

you may refer to http://www.nanyang.com/node/423965

Paisei

Channel 5 http://www.horlic.com/mrta-vs-mlta-which-one-is-the-best-housing-loan-insurance/
Channel 8 http://www.nanyang.com/node/423965[/url][/QUOTE]

 

[myrsing]

Paisei

Channel 5 http://www.horlic.com/mrta-vs-mlta-which-one-is-the-best-housing-loan-insurance/
Channel 8 http://www.nanyang.com/node/423965[/url]

Tks potter.

 

[potter]

Tks potter.

No problem.
Before signing the dotted line, verify those clauses tat you are unsure about.
certain banks will change the BLR-2.4% to BLR-2.0%(for example) if missed e mortgage payments..nd others..That Hurts dude!