Property questions
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MMM : new loan - lemme go home and get the contacts will let u know tomorrow
i was told that the rates will be increasing soon - not sure how true that is ..
CSB : it's a new loan. Apologies, i dont know much about re-financing so i cant help - but if it's not in bold in your Letter of Offer/Loan documents, why do you have to pay to re-finance ??
Is it disguised as an \"admin\" fee ?? -
next to govt organisations, banks are the other organisation that I hate having to call. You reach, xxx bank, press 1 for blah blah blah, press this, press that, then sorry all our operators are engaged please leave a message. Leave a message and no one calls me. I always find it strange that the banks spend so much money trying to get new clients but neglect their existing customers.
$500 admin fee seems to be the norm for most banks for repricing loans. I manage to negotiate mine down to $200.
Rate quoted to me in Feb/Mar this year from DBS was 12mth Sibor +0.75% or prime less 2.5%. Sibor at that time was about 0.908% and prime was 4.25%. Sibor has tie-in period and penalty for partial repayment, prime dun have. I went with Prime as we were not sure what we will do with our properties then.
They offered me a lower rate under their treasures customer programme but it came with so many conditions like having to maintain a minimum sum in my a/c, etc and tie-in period of 3yrs. Not worth it. I dun believe in letting money sit idle in the bank. -
Hi to all property gurus,
I sincerely need your views.
We’re in our mid-30s with 2 kids.
Our hdb and car are fully paid.
Dh brings home quite a handsome sum of monthly income.
Hmmm…how shall I say this, we have cash savings of 600k and quite alot in CPF.( this is the part that I find difficulty in sharing with any of my friends. I am not sure how people will view me. How-lian? so the anonymity of sharing this in a forum gave me the courage)
My dh is very prudent. only do a bit of US shares.
We are relocating to overseas for at least 2 years. If you were in our situation:-
1) doesn’t it make sense to use 80% of our savings to invest in property?
2) will you sell the HDB now, since prices are record high and we won’t be staying for the next few years? We can then take our time to buy a condo when the price is better?
3) I told my dh to use 80% of savings to buy 2 condos and the rental itself should be enough to cover the monthly repayment. Keep the HDB cos it is the cheapest house we will ever ever get. But then again, we should sell off HDB cos we got it direct from HDB and thus, will be able to make quite a bit of $ from the sale. am in a dilemma.
4) Did you keep your HDB after buying your other properties?
5) While I’m still riding on the "courage" now, may I ask if you know of any middle-income people like my family who also keep such a tidy sum of cash savings? I always tell my dh it is unwise to just keep saving huge sum of $ and am quite sure people don’t do this nowadays.
But he said don’t underestimate HDB dwellers. He said some of them have more savings than us.
Sorry for the long post and looking forward to your enlightenment.
cheers. -
BeautifulLife:
Hi to all property gurus,
I not guru, just here to share my views.BeautifulLife:
General rule of thumb is to keep 6 months of expenses as cash, the rest may be invested or kept in more illiquid instruments. I don't have that much in the bank accounts, each time it gets on the high side, I'll start scouting for suitable stuff to invest in - eg blue chips, funds.1) doesn't it make sense to use 80% of our savings to invest in property?
BeautifulLife:
If your hdb flat is in a good position, good facing, I honestly think you should not sell it. How to find such a good one next time? Pls note that in very worst case scenario (eg full of debts which I doubt will happen to you), creditors cannot touch hdb (but they can force you to sell your private property).2) will you sell the HDB now, since prices are record high and we won't be staying for the next few years? We can then take our time to buy a condo when the price is better?
4) Did you keep your HDB after buying your other properties?BeautifulLife:
My family has a couple of private properties and we mortgage to the hilt, but we took up Smartmortgage with HSBC (I think Stand Chart used to have this also). Interest earned from the current accounts will be offset against the loan. We have been maintaining the same amount in current account as the loan, we are not incurring interest on our loans. the money in current account can be taken out anytime (if there is shortfall in amount saved versus loan, interest will be levied). It's not the best way to make money work, but we like the security of being able to move our money, and the fact that there is no interest expense.3) I told my dh to use 80% of savings to buy 2 condos and the rental itself should be enough to cover the monthly repayment. Keep the HDB cos it is the cheapest house we will ever ever get. But then again, we should sell off HDB cos we got it direct from HDB and thus, will be able to make quite a bit of $ from the sale. am in a dilemma.
FYI, I think too many pp do this, so HSBC seem to have modified such that you only save on 2/3 of the interest - so will still incur 1/3 interest.BeautifulLife:
It's really personal comfort level. You will lose out in form of inflation by keeping cash, but you gain comfort in knowing there is no see saw (price go up, go down)5) While I'm still riding on the \"courage\" now, may I ask if you know of any middle-income people like my family who also keep such a tidy sum of cash savings? I always tell my dh it is unwise to just keep saving huge sum of $ and am quite sure people don't do this nowadays.
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hquek:
FYI, I think too many pp do this, so HSBC seem to have modified such that you only save on 2/3 of the interest - so will still incur 1/3 interest.
I use the same with Citibank. They call it cash management account. Yes, they've now capped it at 70% of principal. I put all my money there so that we can pay down our housing loan earlier. Who else gives such a interest for deposit? -
sleepy:
If you have multiple properties, do you stretch your loan quantum to the maximum? And solely relying on rental income to service your bank loans? How many months buffer do you set aside in case you can't get tenants for a few months? Anyone bought commercial property instead of residential property?
sleepy,
we have a small commercial property and it was tenated. In terms of returns, i must say that this is better then residential property. We have this for almost 10 years and the tenant is there for as long. We didn't increase the rent though. but we are ok and happy for the stability. For a start, we actually set aside 6 mths to buffer since we cannot use CPF to repay the loan.
But prices now has (also) gone up a lot. So you really have to be mindful of the location and the business mix in the area. -
MMM:
... they asked us to pay $500 for admin fee... just to refinance with them :x
The banks call this \"conversion fee\" and is is common to ALL banks, just a matter how much they are willing to reduce. The fee is incurred because you are converting from one package to the other.
You may be able to negotiate for a partial waiver from local banks. Citibank usually absorbs the fee. -
MMM:
yup yup. I enjoy the idea of savings generating 4% p.a. Last year alone, I think we saved 10K in interest charges. Although I cannot take out that interest and spend, it's gratifying that i'm not paying that sort of money to the banks.
I use the same with Citibank. They call it cash management account. Yes, they've now capped it at 70% of principal. I put all my money there so that we can pay down our housing loan earlier. Who else gives such a interest for deposit? -
hquek:
I enjoy the idea of savings generating 4% p.a. Last year alone, I think we saved 10K in interest charges. Although I cannot take out that interest and spend, it's gratifying that i'm not paying that sort of money to the banks.
Yes yes... to think about 4%, it seems exorbitant now. I really enjoy banking with CITI. My hubby decided to just pay the $500 conversion with UOB so that our interest rate will reduce immediately. If not, we need to wait for 3 months for the switch to other bank. We told ourselves that in 9 months time, we will start to inform the bank and probably make the switch to CITI. Are HSBC, Maybank or SC flexible with such charges??? Anyone can share?
Yes, CITI is really good at waiving of such charges. My 2 other loans were even before the lock in period. I just called them to discuss the options. They not only offered me the significantly lower rate package but also waived off all penalty or other charges. This is why I would prefer to stick to them. This is superb service.
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