Hdb Loan Conversion Package

[chronograph 0]

hi all,

Need some advice on conversion package.

My outstanding loan as at Aug 2011 will be 82k, rough figure only. So i'm pretty stucked with my current bank.

Last year took up a fixed 1 year/1 year lock in HDB loan.

1st year 1.7%

2nd year 1.78 (floating)

3rd year 2.88% (floating)

4th onwards 3.75% (floating)

Now, the Bank offer this 2 years lock in:

1st year 1.25% (MR - 3.25) MR @ 4.5%

2nd year 1.65% (MR - 2,85)

3rd year 2.65% (MR - 1.85)

4th year onwards 3.75% (MR - 0.75)

Conversion fee = $500

Questions:

1) Over the next 2 years will the interest increase?

2) Will it be cost saving to convert? The conversion fee is $500, can it be waived? If not is the fee pay worth the saving?

Thank you.

Edited May 16, 2011 by chronograph

[bepgof 20]

Loan tenure?

hi all,

Need some advice on conversion package.

My outstanding loan as at Aug 2011 will be 82k, rough figure only. So i'm pretty stucked with my current bank.

Last year took up a fixed 1 year/1 year lock in HDB loan.

1st year 1.7%

2nd year 1.78 (floating)

3rd year 2.88% (floating)

4th onwards 3.75% (floating)

Now, the Bank offer this 2 years lock in:

1st year 1.25% (MR - 3.25) MR @ 4.5%

2nd year 1.65% (MR - 2,85)

3rd year 2.28% (MR - 2.22)

4th year onwards 3.75% (MR - 0.75)

Conversion fee = $500

Questions:

1) Over the next 2 years will the interest increase?

2) Will it be cost saving to convert? The conversion fee is $500, can it be wavied? If not is the fee pay worth the saving?

Thank you.

[chronograph 0]

8 years.

Because of this clause "No partial prepayment is allowed once o/s loan tenor is below 5yrs."

So planning to partial repay after 2 years.

Also there is a mistake in my first post, the 3rd year offer should have been:

3rd yr: 2.65% (MR – 1.85%)

(Making correction to the first post.)

Thanks.

Loan tenure?

Edited May 16, 2011 by chronograph

[bepgof 20]

Bro, save the time/trouble to visit bank.

I just calculted up to 6 yrs. At end of 6th yr, u still have principal outstanding:

1. 1st package: $22,340.45, interest pay within 6 yrs will be: $8511.75

2. 2nd package: $22,254.00, interest pay within 6 yrs will be: $7915.24

Interest save = $596.51

I have an outstanding loan of abt 82k for existing resale hdb, remaining tenure ~27yr. Much cpf used up for 2nd property (top 2014). Much cash get stuck in stk mkt. Intend to clear this 82K once some stocks breakeven, at one go.

Very much depend on usa's performance, QEs seem not work to expectation. Euro's 5 or 6 pigs also very weak. Middle East can anytime go unrest. Aust flooded, NZ earthquake, Japan 3-in-1. So, within 1-2 yr interest likely to be remained low. Whether with or without $500, make no difference, to me.

hi all,

Need some advice on conversion package.

My outstanding loan as at Aug 2011 will be 82k, rough figure only. So i'm pretty stucked with my current bank.

Last year took up a fixed 1 year/1 year lock in HDB loan.

1st year 1.7%

2nd year 1.78 (floating)

3rd year 2.88% (floating)

4th onwards 3.75% (floating)

Now, the Bank offer this 2 years lock in:

1st year 1.25% (MR - 3.25) MR @ 4.5%

2nd year 1.65% (MR - 2,85)

3rd year 2.65% (MR - 1.85)

4th year onwards 3.75% (MR - 0.75)

Conversion fee = $500

Questions:

1) Over the next 2 years will the interest increase?

2) Will it be cost saving to convert? The conversion fee is $500, can it be waived? If not is the fee pay worth the saving?

Thank you.

[chronograph 0]

Thanks for the help and calculation.

Maybe I did not make myself clear. At the moment, I'm on 1.7% locked in for 1 year(loan tenure 10 years), come Aug i will be free to convert.

So I'm comparing if i stay on with the current loan, the 2nd year(Sep 2011 to Aug 2012) will be at 1.78%, 3rd year @ 2.88%(Sep 2012 to Aug 2013). Whereas if i decided to change, i will be paying 1.25% for (Sep 2011 to Aug 2012) and 1.65% ... so on.

Comparing the first 2 years, how is the saving like?

Thanks in advance.

Bro, save the time/trouble to visit bank.

I just calculted up to 6 yrs. At end of 6th yr, u still have principal outstanding:

1. 1st package: $22,340.45, interest pay within 6 yrs will be: $8511.75

2. 2nd package: $22,254.00, interest pay within 6 yrs will be: $7915.24

Interest save = $596.51

I have an outstanding loan of abt 82k for existing resale hdb, remaining tenure ~27yr. Much cpf used up for 2nd property (top 2014). Much cash get stuck in stk mkt. Intend to clear this 82K once some stocks breakeven, at one go.

Very much depend on usa's performance, QEs seem not work to expectation. Euro's 5 or 6 pigs also very weak. Middle East can anytime go unrest. Aust flooded, NZ earthquake, Japan 3-in-1. So, within 1-2 yr interest likely to be remained low. Whether with or without $500, make no difference, to me.

[bepgof 20]

See if this helps. Pay attention to $ pay toward interest, the less the better.

http://img9.imageshack.us/img9/3105/uobloanspreadsheet1.jpg

http://img854.imageshack.us/img854/9331/uobloanspreadsheet2.jpg

Thanks for the help and calculation.

Maybe I did not make myself clear. At the moment, I'm on 1.7% locked in for 1 year(loan tenure 10 years), come Aug i will be free to convert.

So I'm comparing if i stay on with the current loan, the 2nd year(Sep 2011 to Aug 2012) will be at 1.78%, 3rd year @ 2.88%(Sep 2012 to Aug 2013). Whereas if i decided to change, i will be paying 1.25% for (Sep 2011 to Aug 2012) and 1.65% ... so on.

Comparing the first 2 years, how is the saving like?

Thanks in advance.

Edited May 16, 2011 by bepgof

[chronograph 0]

Thanks Bro.

Definitely good saving, so probably going for the conversion.

See if this helps. Pay attention to $ pay toward interest, the less the better.

http://img9.imageshack.us/img9/3105/uobloanspreadsheet1.jpg

http://img854.imageshack.us/img854/9331/uobloanspreadsheet2.jpg