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mortgage rates down

That’s true. There is a new round of price war among banks for consumer loans, with the new mortgage rate going down to as low as base lending rate (BLR) -2.3%. The current BLR rate is 6.3%.

This is a very good news to property investors because they can obtain cheaper loan to buy more properties. With the news that Malaysia properties are booming, there are more reason to buy properties especially medium to high end landed properties.

There was a lots of interest in Malaysia properties priced below RM2mil and less movement among the higher end homes. Many foreigners especially from Singapore keen to invest in Malaysia due to affordability.

The new mortgage rate is now down to as low as BLR-2.2% since end-July.

After a quick check, below are the rates offered by some of banks. I believe other banks also have the same competative rate.

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interest rate

Following Bank Negara decision to raise Overnight Policy Rate (OPR) by 25 basis points to 2.5% last week, some banks in Malaysia start to revise up their Base Lending Rate (BLR) and Base Financing Rate (BFR).

This is the second time in 2010 that Malaysian have to bear the burden of higher interest rate. The first increase was implemented in March 2010.

Maybank, CIMB Bank, Public Bank, RHB Bank and Bank Islam have increased their BLR & BFR by 25 basis point to 6.05% from 5.80% previously. Other bank will follow suit.

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interest rate

With recent hike of Overnight Policy Rate (OPR) by Bank Negara Malaysia (BNM), Banks do not take a long time to raise BLR and BFR. The first bank to raise the BLR is Bank Simpanan Nasional.

BLR normally used in conventional loan package while BFR normally used in Islamic loan package. However, most of the time BLR & BFR figures are the same.

The table below show the latest BLR or BFR rate for most of banks in Malaysia as at 12th March 2010. This table is no longer maintained. The latest rates can be found on this page.

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interest rate

Following Bank Negara decision to increase the overnight policy rate (OPR) by 25 basis points last week, banks have begun to raise their base lending rates (BLRs). Bank Negara last week increase the OPR from 2% to 2.25%. Bank Negara raised the OPR as the economy has improved significantly and returned to its path to recovery.

So far BSN, Maybank, CIMB Bank, Public Bank, Hong Leong Bank, RHB Bank, Standard Chartered & HSBC announced their interest rate hike by 25 basis points from 5.55% to 5.8%. Other banks are expected to announce their decision soon. On the bright side, the increase in OPR & BLR also will result in increase in the interest gain from saving account, current account and fixed deposit.

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Mortgage Life Insurance is an insurance that loan owner purchase when buying a property. It is designed to settle the outstanding loan balance in the event that the borrower dies or suffers from total and permanent disability (TPD) prior of settling the loan.

Basically there are two types of mortgage life insurance that are available in the market. There are Mortgage Reducing Term Assurance (MRTA) or Mortgage Decreasing Term Assurance (MDTA) and Mortgage Level Term Assurance (MLTA).

The table below shows the different between MRTA/MDTA and MLTA

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