Malaysia Bank Mortgage Update

Dear Readers,

Many changes had taken place over the last one year, ranging from the introduction of Base Rate in place of the Base Lending Rate (BLR) to the introduction of more restrictive lending guidelines and polices such as reduced margin of financing, restrictive loan tenure (for refinancing), etc. For Malaysian working in Singapore and Singaporeans who used to be happily buying up properties in Malaysia, even they are affected as they now have to compulsorily submit their Credit Bureau Singapore (CBS) Report for bank loan applications. (Just to clarify, CBS is similar to our CCRIS report)

So now you have it, the new loan rates are typically structured in "Base Rate+Spread"=Interest Rates. E.g., 3.99+0.56%... Each component differs for all banks. Base Rate (BR) essentially is determined by the banks' benchmark cost of funds and the Statutory Reserve Requirement (SRR). Whereas Spread reflects borrower credit risk, liquidity risk premium, operating costs and profit margin. In the normal circumstances, banks will revise the Base Rate from time to time to reflect changes in their cost of funds.

For Borrowers who secured their loan prior to 2015, do you need to be worried with the above? Not at all. This is because whatever secured last time remains the same or status quo. However, should you go for refinancing, the new regime shall prevail.

Below is the latest Base Rate for various Financial Institutions as per April 2016 (Source: BNM):

From the Table, you could see that Maybank is having the lowest Base Rate. Do you then just jump in to apply for their loans? Answer is NO. Their effective rate is still similar to other banks because their spread is set high! So is just an illusion!

Back to the bottom line, each and every bank has a different way to assess the loan applications. Your chances of securing loan approval will still depend very much on your credit profile and whether it can match with bank's requirement.

All the best in 2016 for your property journey!

Interest Rate Sets To Rise, and Is Not Just BLR

Barring any unforeseen circumstances, the good old days of low interest rates is over soon. Therefore, be prepared to tighten your seatbelt for your secured property loans.

As we all know, US QE tapering has already begun and is a matter of time the Federal Reserve will start raising their interest rates. We have already witnessed a number of Asian countries started to raise their interest rates too, in order to prevent significant capital outflows. Will Malaysia be any different?

The answer is quite a certainty, NO. Foreign liquidity is like a sum of all parts, someone will gain at the expense of others, and vice-versa.

At the banking side, we are already seeing banks gradually revising their interest rates upwards, by reducing the spreads. That means to say, loan packages such as BLR-2.4 or BLR-2.5% may just be a thing of the past. And we are not even talking about BLR yet (currently at 6.6%), which is directly influenced by Bank Negara's OPR (Overnight Policy Rate). Few months back, Bank Negara already presented a working paper on revamping the BLR framework, with the intention to protect the risks of Malaysia's lending financial system. Obviously, Bank Negara is concerned that with the potential real estate property cycle reaching its peak, our banks might have undertaken too much risk by undercutting their margins (vs the cost of funds).

Should say BLR increased by 50 basis point, and spread reduced to 2%, the effective interest rate will become 5.1%. That translates to about 11% increase in monthly installment for a loan size of RM500k with 30 years loan tenure!

For the more conservative, time to look at fixed rate loan perhaps?

New Fixed Rate Home Loan

New and best Fixed Rate Home Loan in town!

1st 2 years: 4.25% only
Thereafter: 4.99% Fixed For Life
OR
Whole Tenure: 4.85% fixed for life

No lock-in period except for refinancing.

PEACE OF MIND ON YOUR LOAN INSTALLMENT regardless of what happens to interest rate.

With US Federal Reserve pulling a stop on QE (Quantitative Easing), likelihood interest rates will rise soon. Same applies to Malaysia. PROTECT YOURSELF NOW!

Interested please email me at mortgagebroker.my@gmail.com

Latest Commercial Loan Offer

Special Commercial loan package, currently best in the market, Limited time offer.  Terms and conditions apply,

Loan amount
Between RM300k to 499k (BLR-2.25%)
Between RM500k to 999k (BLR-2.3%)
At or above RM1m (BLR-2.35%)

Max margin up to 85%
3 Year lock-in period
maximum tenure 25 years or age 70, whichever comes first.
Applies to both new purchase and refinancing.

Commercial Property type:
Shop house and shop office only

If interested, contact me at mortgagebroker.my@gmail.com or call.

Financing For Vacant Bungalow Land

Are you buying a piece of bungalow land and looking for the best financing?

Normally, the highest margin of financing is between 60% to 70% for land, and most banks only go for land at prime location only.

If you want better financing, you should include construction over it. If you include both land and construction, your margin of financing can be up to between 80% to 90%! That's quite a drastic difference.

Take note that most come with condition that you need to complete building within 2 to 3 years.

Interested? Email me.

How To Get 100% Financing Housing Loan?

Is this a myth or a fact? Answer is it's a fact.

Only few banks are offering this. Of course, subject to terms and conditions, and your financial profile meeting the criteria. The maximum DSR capping is generally extended after taking into account the new loan installment.

This is good for buyers who want maximum financing, so they pay less or nothing from their pocket.

Bear in mind the normal Loan-to-Value (LTV) guideline still applies. In this case the differential that make up that 100% (extended loan) is capped at maximum of between RM150k to RM300k.

The "catch" is you need to pay a higher interest rate for the extended loan. Depending on your purpose and objective, this may still be worthwhile. Of course, you can still enjoy the normal housing loan rate for your normal LTV eligibility.

Maximum loan tenure is 10 years for the extended loan.

Interested? Please contact me via email.

Usage of Credit Card Affects You

Most people (including me) like using credit card because one can pay later (upon payment due) and you get to collect reward points for gift redemption later. As long as one makes payment promptly before the due date, no issue whatsoever.

However, it's a different story now! Be very careful with your credit card spending, as it will affect your credit eligibility when applying for a loan! All spending is now linked real-time (or almost real-time) to CCRIS and they will appear as OUTSTANDING in your CCRIS report even though the amount is not due for payment yet! Most banks have implemented this already. In the past only late (overdue) payment appeared as outstanding.

In other words, as and when you buy anything with your credit card, it will appear as amount outstanding in your credit report and will therefore become part of your commitment as well.

Personally i don't think this is fair but Bank Negara obviously think otherwise, in order to clamp down on credit card debts.

Fix your loan interest rate for LIFE!

Are you concerned about rising interest rates and therefore risk of not able to repay your monthly installment? Why not lock in your loan interest rates at fixed rate for life?

Currently the best offer is 4.80% fixed. Take advantage of this historical low rate now. Free yourself from further surprises and stabilize your cash flow.

Special Ultra Low Rate Loan Package

Good news! I can offer you the following limited time only special home loan offer at ultra-low interest rate at BLR-2.45%, with only 3 year lock-in.

1st 3 Years: Fixed at 4.38%;

Thereafter: BLR-2.45%

Minimum loan amount only RM300k!

If interested, please email me at mortgagebroker.my@gmail.com.

The bad news is the offer expires 12th April 2012. So hurry as response is overwhelming!

Terms and conditions apply.

Bank Mortgage FAQ

This is a common question I'm being asked...As a Mortgage Broker, can we offer the best package in town?

The answer is certainly YES! As far as the banks are concerned, we are also helping them to secure more deals, with minimal costs, so you can be assured that you can get the best deal, provided you meet the bank's criteria as always.

As at now, the best mortgage lending rate we can offer is up to BLR-2.5%. Terms and conditions apply.

Pay Less With Your Housing Loan

Are you feeling the burden paying too much for your upcoming or existing housing loan installment? How about just pay interests for the next 3 to 5 years and nothing else? Or how about service only half the full loan amount and the rest defer until you retire?

Contact us now for further details.

Latest Flexi Loan Promotion With No Monthly Fee

Tired of paying monthly maintenance fee for full-flexi loan account? We have the right solution for you that helps you save more - no monthly fee, and up to 100% discount on stamp duty, and more!

Contact us now to enjoy more savings with our latest full-flexi loan.

Latest Home Loan Promotion

Would you like to have a Home Loan with up to 100% Margin of Financing? You can now do so together with your renovation!

Contact us now for further details.

Refinancing

Looking to refinance your home loan? Or do you have a housing loan that is dated more than 5 years old? Look no further, we have the best refinancing package in town, with up to 90% margin of financing at attractive rates. We can help you to achieve significant savings in interests and/or help you to restructure your loan that fits your needs. You may choose to cash out for other investment purposes or simply to save interests.

If you already have more than 2 housing loans and would normally subject to the 70% Loan-To-Value (LTV) ratio, talk to us now as we have the solution for you.

Contact us now for further details.