Refinancing Question and Answer ( Q & A):
( All Q & A are from our customer, if you have any questions about refinancing, please go to our contact us page and drop us your questions. We we shall reply to you as soon.)
1) Question : I bought a house in 2007.Purchase Price is RM300,000. I took a loan of RM270,000. Currently, my outstanding balance is RM260,000-00. My lock in period had just end. Do you think I should refinance my property? I could use some cash though.
If you need additional cash to suit your purpose, refinance definitely is a smart choice. However, it is important to calculate the cost for refinancing.
As a guide, you can always go to our refinancing column to check out our advices on refinancing.
And if you still confuse. Just go to our contact us form and fill up your information and we shall assist you soon.
2) Question: I’m not sure whether I’m still in lock in period or not? What should I do?
It’s simple! Just call up your existing bank’s customer service number or alternatively walk in to the bank. They shall be able to help you.
3) Question: I do not know how much my housing loan outstanding balance. Where should I go?
Normally, bank will send a 6 months bank statement or one year statement to your mailing address. If you do not receive the statement, probably your address is out of date. You have to call or go to the branch to update your address.
However, you can call up the customer service and get a verbal outstanding amount or you can go to the branch to request for a print out.
Please take note, some banks are charging minimal fees for this. From minimum RM5 to RM50. If this too expensive for you, you may want to update your mailing address.
4) Question: My housing loan interest rates is BLR-1.80%, so is this expensive? Should I refinance?
Answer: It is difficult to answer the above question without further information given.
We have to determine whether you are suitable candidate for refinancing, we need to review all the information such as your penalty fees and period, previous housing loan product, loan outstanding amount, original loan amount and etc…
We will access your details to confirm whether you re suitable for refinancing. If you are not suitable for refinancing, we will advise not to do so or let you know the best time to do it.
5) Question : What is Base Lending Rate ( BLR )? Can I know the latest BLR rate?
Base Lending Rates (BLR) definition is minimum interest rates calculated by banking institution based on a financial formula which will take into account the financial institution cost of fund and other administrative charges.
On simpler explanation, the BLR is actually based on interest rate that banks refer to internally before they decided to charge you the loan interest rates.
Current BLR is 6.85% for most of the banks. But, some banks do have higher BLR.
BLR is not negotiable. However, the bank’s interest rates are negotiable.
For example, if your current interest rates is BLR-2.20%, means you are getting 6.85% – 2.20% = 4.65% interest rates.
You are able to negotiate the rates of 2.20% to may be lower to 2.40%, but BLR = 6.85% is not negotiable.
BLR will have movement; there will be up and down. It is depending on our economic growth and Bank Negara (BNM) control over Overnight Policy Rates (OPR). OPR will be review every 3 months. All the banks are allowed to peg their own BLR. However, most of them will review BLR with the changes of OPR.
6) Question : I would like to do a refinancing. My current loan with Bank A is under joint name. I would like to apply with new bank loan and this time just under my name. Can I do this?
Yes, you can apply the new loan under your name only. However, there are banks that not allow this. Not to worry, most of the banks are okay with this.
7) Question : I am in the process of divorcing with my husband. Currently, property and loan under both of our name. As agreed, I will buy over his shares. Do I need to re-do the loan?
Yes, you have to re-do the loan.
Previously, the loan agreement under both of your name, you have to change under your name.
8) Question: How much I can borrow?
Some banks are offering up to 90% margin for refinancing. However, some are 80%.
For example, if your property market value is RM300,000 x 80% = RM240,000 or RM300,000 x 90% = RM270,000.00
9) Question : I did not pay my housing loan instalment for last 2 months and within 1 year I may have 2-3 months arrears in some other facilities as well. I would like to refinance to settle my debts. Do you think I should pursue refinancing?
If you have defaulted in your current housing loan instalment or even other loan facilities, we are advising you to print you bank Negara CCRIS report before proceed for refinancing application.
After print the CCRIS report, you can always forward to us for better consultation or even you can show to the bankers, to get their genuine advice.
Normally, banks are quite sensitive when customer did not pay promptly especially on your “refinance housing loan”.
10 Question : How long the process for refinancing?
For approval, normally are 1-2 weeks times. However, if your case is not straight forward, the turnaround time may be longer.
For loan disbursement, will depend on your property title status (Master title , individual title or strata title ), developer confirmation, freehold or leasehold property.
During signing of loan agreement you can ask the loan lawyer on the estimation time for disbursement.
Normally, will be within 3-6 months time.