Mortgage

At Abacus, we first do a profile matching to assess your credit profile and match it with the credit criteria of respective banks. This helps speed up subsequent application process while minimising reject risk which will leave a dent in your credit record.We then work on your behalf with several banks at one go to get you a Letter of Offer (LO), thereby saving time compared to applying from one bank at a time.

Our remuneration is not tight to any bank, we represent your best interest and hence we are impartial in finding you the best suit terms and conditions for your financing needs.

1. What types of Housing Loans available?

: Fixed rate loan is a loan where the interest rate doesn’t fluctuate and remains the same during the loan tenure . This allows the borrower to factor a constant future repayment until the loan is paid off. No exposure to interest rate hike.

: Variable rate loan ( semi flexi- loan or flexi loan ) by contrast is anchored to the prevailing bank interest rate, it is important to be reminded that both the Base Rate (BR) and additional margin (aka “spread”) may change from time to time.

2. How much can I borrow from the bank?

: Usually bank requires 10-20% of the home purchase price to be paid as down payment.

: The amount of loan is also determined by your debt service ratio (DSR). It’s a simple calculation of your total commitment divided by your net income in percentage.

3. How long can a loan tenure be?

: The maximum loan tenure is 35 years or till the borrower reaches 70 years old, whichever comes first.

4. What is the current market interest rate?

: Depending on individual scoring and profile, the borrowing rate is between 3.3% to 3.5% based on prevailing Overnight Policy Rate (OPR) of 2 percent .

: Borrowing rate is comprised of BR plus a “spread”.

: Every bank determines their own BR and the movement of BR is in sync with the change of OPR.

5. What is the lock-in period of a housing loan?

: This is the pre-determined period of what the bank will charge you (penalty) if you decide to settle your loan earlier. Generally, this can be between 2-5 years with the penalty ranging between 2-3% of your total loan amount.

Why refinance?

: save interest payment with lower instalment due to lower interest rate!

: cash out for investment opportunities, business working capital, property renovation, children’s education payment.

: loans consolidation (get a lower interest rate loan to finance higher interest debts such as Personal Loans, Credit Card Loans, or even Hire Purchase)

When is the best time to refinance?

: when your income is still “bankable”… in relation to your financial commitments.

: 6 months before important due date where cash-out is required.

: when it makes sense to to change from a floating rate loan to fixed rate or vice versus at different stage of interest rate cycle.