Before buying a home, we have to study and identify the types of loan available.

In opinion, there are three types of home loan that are commonly used in Malaysia.

They are basic term, semi-Flexi, and as well as full-Flexi.

Basic Term Loan.

• This loan comes with a fixed payment schedule, where you pay a monthly installment that will always be the same throughout the entire loan period.
• This category of loan does not allow (or may be difficult for you to do) cut the interest rates by paying an advance installment. It means, even if you pay early, it is difficult to reduce the bank interest rates which already set.
• Any additional payment that you make, the bank will consider it as a pre-payment for installment payments for the future. And this does not give any effect on the interest rate of the loan, meaning that you still have to pay monthly installments at the same rate.

Semi-flexi Loan.

• This type of loan equipped with facilities that allow borrowers to make an advance payment to reduce the loan interest without having to make any formal request from the bank.
• The total of the additional payments you make each month, it will automatically change the original interest rate for a home loan that you make.
• If you want to use the money, you can create an application with the bank to get back the additional payments made.
• But the process is not free. Maybe you will incur a charge of RM50 to RM100 depending on which bank you made the loan.

Full-flexi Loan.

• Full-Flexi home loan (or “Flexi loans”) takes the concept of flexible payment to the next level.
• This type of loan allows the borrower to make a down payment to reduce the loan interest rate.
• At the same time, it allows the borrower to spend additional payments made at any time they like, without any time-consuming procedures or additional charges.
• In the normal flexion package, you will get a loan account that is associated with the current account, as well as a cheque book.

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