Alice asked 9 years ago
Hi kclau. I am 30 years old and is about to buy my first property. The property price is 608k ( the developer offered a 10% rebate ) but bank valuer said they can only give me 550k loan. However after contacting the developer they introduced me to a few more banks in kl and I was informed they can give me the 608k price.
Now I am a bit skeptical why is there a discrepancy on the market values? And question 2: should I put more for down payment or pay more for monthly installment ?
Looking forward for your reply . Thank you
KCLau Staff answered 9 years ago
Hi Alice,
Each bank has different lending policies. As in business, banks might view the projects, the borrower, the developer differently. Therefore there is always a difference, even for completed subsale property.
Whether you should put more money down or pay more for installment, it depends very much on your personal level return rate. For example, if you never invest and just leave the money in FD earning 3%, then pay more for mortgage makes sense because the loan is ~4.5%.
If you are an entrepreneur and making 50% from your business capital, logically you will loan as much as possible to expand your business. Or in a usual case, someone who can invest say in ASB and get 6% return, then it makes more sense to have the money invested instead of paying advance for the loan.