The maximum loan tenure of the new mortgage could be up to 35 years, or when the borrower is 70 years old, whichever is earlier. The new loan of RM200,000 will be used to pay off the original loan with Bank A. The borrower could consider refinancing the mortgage by taking a new mortgage from Bank B for the remaining RM200,000. The original loan amount of RM300,000 has been paid down to RM200,000. However, if you have a property under a mortgage for some years, you can actually make use of the property’s increased market value to apply for a new loan from banks.Ĭalled mortgage refinancing, the new mortgage will be used to pay off or redeem the existing mortgage in the process, using the property as collateral, explains RHB Banking Group head of group retail banking U Chen Hock.įor example, let’s say a borrower’s existing mortgage has been with Bank A for 10 years, with a remaining tenure of 15 years. IF you need a loan to finance your property purchase, or for business investment or children’s education, you may be put off by the current tight lending environment.
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