How much is your outstanding housing loan?

[Soya]

For those MCFer who hv paid off their first pte property loan but still have an outstanding second pte property loan, has anyone taken on a equity term loan on the first property at a low interest rate to use it to pay down the second loan which has a higher interest rate?

 

[Throttle2]

For those MCFer who hv paid off their first pte property loan but still have an outstanding second pte property loan, has anyone taken on a equity term loan on the first property at a low interest rate to use it to pay down the second loan which has a higher interest rate?

Equity term loan got cheaper meh?

[Soya]

Equity term loan got cheaper meh?

Dunno that's why ask sifu like u

[Throttle2]

Dunno that's why ask sifu like u

I no sifu

Sifu is @enye

Sishiong is @kusje

[Showster]

The equity term loan interest rate follows the mortgage rate but might be extended beyond 65 years old.

 

In an interest-dropping environment where one of your mortgages is in locked in period, yes, you may take an equity term loan on another paid up property. It doesn't have to be fully paid up if you have the income and some more working years ahead to back it.

 

But in an interest-rising environment like right now, such opportunities will be rare indeed.

 

Maybe in 2020 or 2021, there might be a chance for rate cuts again, but not guaranteed as well. Caveat emptor.

 

For those MCFer who hv paid off their first pte property loan but still have an outstanding second pte property loan, has anyone taken on a equity term loan on the first property at a low interest rate to use it to pay down the second loan which has a higher interest rate?

 

[Kusje]

I no sifu

Sifu is @enye

Sishiong is @kusje

Wah.

 

Don't quote me in this thread lah. I scared it is the bank asking for their money.

[Throttle2]

Wah.

 

Don't quote me in this thread lah. I scared it is the bank asking for their money.

 

Never quote you lah

 

Only call you shishiong.

Like how you call Sifu, Sifu leh....

 

Muayhahahha

[Jamesc]

Ok la he got the right to haolian hahaha

Yah if not happy can repair the face

Thought ur MIL good looking?

She is good looking.

 

Only personality is defective.

 

Inner beauty is important too.

 

[Throttle2]

Looking at the results of the poll, i am glad to say that a big portion fall in the fully paid up category.

 

So Huat Ah Bros

Cheers to you all

[Extremme]

So assuming I am buying a resale house of $450k. I have $370k in cpf to clear. I have sufficient cash to clear that 80k  balance, will you Clear it all or take loan ? 

Thoughts? I have friends who suggested to take loan between 5-10 years because their perspective is to leverage on HPS. If a borrower passes away, HPS immediately kicks in to pay off the remainder of the property loan. 

In that sense, your cash will still be your cash. If we are to pay up in full we cant leverage on that HPS. I mean what are the chances right but things are unpredictable. Not forgetting we amt in CPF has 2.6% interest.

Or you will choose to clear all and that means you will not incur loan interest?

 

Another side topic, if we fully paid the hdb loan, are we restricted to MOP (5 years still)? 

[Jamesc]

The interest is daylight robbery. 

Just rent lah. 

And put the difference between buying and renting into buying bank shares. 

Then you get the profit from the interest people pay as dividends and use the dividends to buy more bank shares. 

And after 30 years you get so much bank shares you can use the dividends to pay for your rental forever. 

 

 

Edited January 15, 2020 by Jamesc

[Jamesc]

Better to own banks than property. 

It's like you can profit like a loan shark but it's all legal. 

[Jamesc]

A small business can fail but a bank cannot fail. 

Even if if they make bad loans tax payers money will be used to save the bank.

[Sx4falcon]

1 hour ago, Extremme said:

So assuming I am buying a resale house of $450k. I have $370k in cpf to clear. I have sufficient cash to clear that 80k  balance, will you Clear it all or take loan ? 

Thoughts? I have friends who suggested to take loan between 5-10 years because their perspective is to leverage on HPS. If a borrower passes away, HPS immediately kicks in to pay off the remainder of the property loan. 

In that sense, your cash will still be your cash. If we are to pay up in full we cant leverage on that HPS. I mean what are the chances right but things are unpredictable. Not forgetting we amt in CPF has 2.6% interest.

Or you will choose to clear all and that means you will not incur loan interest?

 

Another side topic, if we fully paid the hdb loan, are we restricted to MOP (5 years still)? 

I take max loan. Installment will be fully service using CPF.

Bank loan interest rate is lower then CPF interest rate. To me, it doesn't make sense to take money out to pay. I rather keep the money in CPF to earn interest.

[13177]

10 minutes ago, Sx4falcon said:

I take max loan. Installment will be fully service using CPF.

Bank loan interest rate is lower then CPF interest rate. To me, it doesn't make sense to take money out to pay. I rather keep the money in CPF to earn interest.

You mean take loan better if installment is fully paid by CPF?

[Sx4falcon]

Just now, 13177 said:

You mean take loan better if installment is fully paid by CPF?

Yeap. Assuming the same amount, Interest you earn from CPF will be higher than the interest you are paying the bank.

 

[13177]

6 minutes ago, Sx4falcon said:

Yeap. Assuming the same amount, Interest you earn from CPF will be higher than the interest you are paying the bank.

 

If want your house loan installment to be paid fully by CPF, either the price of the house you buy is low or the amount of loan you take is low. If not many people still need to pay the installment both by CPF and cash.

[Sx4falcon]

35 minutes ago, 13177 said:

If want your house loan installment to be paid fully by CPF, either the price of the house you buy is low or the amount of loan you take is low. If not many people still need to pay the installment both by CPF and cash.

when doing financial planning to buy a house, i will not stretch myself too much that need to pay monthly installment by both CPF and cash. I will also cater such that there will always be enough balance in my CPF to pay the installment for a period ot time in case of no CPF contribution during  the period due to whatever reason.

Edited January 15, 2020 by Sx4falcon