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What are some of the factors when choosing a home loan?

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Apart from the lowest interest rates possible, make sure that you do not have a lock in period for the loan whereby you are able to settle the loan sum fully without a penalty. If you are planning to stay at the home for longer term (and not an investment property) you may want to par down the interest by paying more than the scheduled monthly repayment amount so that you save on the total interest paid at the end of the loan term.      

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If for investment, I would say try to aim for the lowest monthly repayment. Think lowest interest, longest repayment tenure

It will be easier for the rental income to cover your loan installment. 

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@domng Yes, I agree on that if it is an investment property. Again be wary of the lock in period penalty imposed by the bank should you need to sell and cash out within 5 years or perhaps if you need to sell to upgrade to a bigger home.   

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@davidwong totally agree

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The loan lockin period is really a killer if we really need to sell off the property real quick for cash. 

But then again, property investment is not that "liquid".

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The housing loan package provided by all the bank in Malaysia is more or less the same. You need to consider whether you need a flexi-loan or jus a home loan. If you have spare cash to dump in, flexi-loan will be a great choice since you can save interest. Other thing is to consider the interest, loan tenure, lock in period.

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@vicky_vivahomes Yes, I have taken a home loan for my first home when I was earning a salary and subsequently a flexiloan for my second home when I got into sales and business. Works pretty well except that I should not have paid up my flexiloan within the first 5 years of fixed low interest rate  as you can draw down the loan again for further purchases if the opportunity arises. 

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@nisyaaziz88 There are mortgage brokers in the market place that may be able to assist you on which bank or financial institution provides you the best terms based on your credit profiling. Do let me know if you need their services.  

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@davidwong 

Do you mean, you would rather refinance your existing home loan for the extra investment capital? 

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@davidwong & @domng, for flexi loan, actually u can fully paid off your loan anytime, you just do not discharge the loan, then you can withdraw the money anytime for further purchases if there any opportunity. Jus maintain the account, you do not need to do refinance, this will waste alot of legal fees & stamp duty. 

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@vicky_vivahomes 

Agree on Vicky

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@jdh As explained by Vicky it's a draw down not refinancing from your existing loan account.


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@davidwong 

Draw down... so in other words, even though fully paid off loan...consider not to discharge the loan and maintain the account for future withdrawal, for investment perhaps?

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@domng Yes. way to go!

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1) interest

2) lock in period

3) other charges

4) loan features (flexi/fixed)

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@6011_3531_5354 

Others charges. You mean loan legal fee, stamp duty, loan discharge fee, withdrawal fee for flexi loan etc etc? 

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@domng yes, other fee that incurred by bank.

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Hi TS @nisyaa, i think most of the important factors has been mentioned here.


But i would like to highlight for the nature of the loan. Conventional or Islamic. Although Islamic loan seem to be more attractive due to its lock in period, however the hidden cost you might occur in the future will relatively higher compare to conventional.


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@alexlau_access 

What hidden cost are you talking about? 

Islamic loan appears to be a trap. 

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reduce usage on credit card also to have lower DSR on yr application

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@sultana good sharing