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“Cash Back” scheme, first popular by credit card issuers, then spread to hypermarkets, and now it seems to catch on with personal loan too.

Claimed to be “the only personal loan that gives you 20% cash back each month“, Hong Leong bank latest offering is eye catching which certainly deserves some eye-opening detail too.

The “cash back” offer

First, the ‘cash back’ is applicable not throught out the entire loan period, but is a feature that kick-in after the first 6 months of the loan and ends 6 months before the loan ended.  In short, no matter what is the loan period, there is a total period of 12 months that the borrower paying the standard interest rate per annum, which is 12%.

Secondly, to enjoy the ‘cash back’, the borrower has to satisfy 2 very important conditions - prompt payment for the first 6 months, and consistent prompt payment through out the entire period (100%, not a single late payment). Failing to meet these 2 conditions means no cash back or the cash back offer will be cancelled.

So with those ‘cash back’, what is the interest rate after all?  The quoted free video poker how to play backgammon no deposit bonus online casino 888 no download casino play roulette craps game black jack download american roulette play video poker baccarat free casino game no download online casino free money on line casino wagering roulette online online casino betting free online casino slots free craps best casino roulette gambling internet casino gambling uk best casino online full pay video poker no deposit casino code best craps game black jack tournament best online casino site craps online game newest online casino free slots no download play blackjack online free dueces wild video poker black jack gambling online video poker game free casino cash no deposit video poker tutorial play free video poker how to win at black jack casino roulette casino guide how to win at roulette rules of craps casino game online real money backgammon baccarat casino online free video poker game play free video poker video poker odds video poker tournaments flat interest rate is 12% per annum.  For the 1st year and the last year, the borrower is paying 6 months at 12% per annum and then 9.6% per annum for the remaining 6 months.  Therefore the interest rate for the first and last year is 10.8% per annum.   As for the rest of the period, it is 9.6% per annum.

To be sure, 9.6% is probably not the lowest, at best it is on-par with market average.  However, the final interest rate is much higher as the borrower will not get 100% of the loan approved.  For loan below RM100,000, there is a processing fee of RM100, and stamp duty of 0.5% of the loan amount.  These processing fees are directly deducted from the loan amount.

Conclusion

This is a very smart scheme as it sounds very attractive and best at all, the bank can selectively reward (in the form of limited cash back) those good customers who pay promptly.

How to increase your loan approval chances?

It is very simple, bank looks at your repayment record.  To be successful, make sure you have at least 12 months prompt payment record on all of your existing loans - car loan, housing loan, credit card payment, and may be your higher education loan too!  Top on the list is credir card payment record. Therefore, it is very hard to get a  personal loan to cover your credit card payment if you already fall behind the payment schedule.

In a short space of few months, Bank Negara has lowered the overnight policy rate (OPR) 3 times, with a total reduction of 150 basic points.  To those with home morgage, that directly translate to lower BLR which is currently stands at 5.55% (average).  My home loan repayment is RM243 lesser now.

Though expert generally believed that there are still rooms for Bank Negara to further rate cut, this is a good time to re-evaluate your hosing loan package.  In coming months, we are likely to see banks becoming more aggressive in selling thier housing loan packages to cushion the expected raised of NPLs.

I recently called the bank asking for my housing loan status and was rather pleasantly surprised by the frank advice given.  Well, I was askling how can I lower my interest rate though I am still in the bonding period.  The reply was write to the bank and most likely the bank will consider my request.  However, there is usually a “penalty” comes together with the new offer, and the trick is, write to the bank again and the bank may gives a discount on the amount of the “penalty”.

The key takeaway is that banks generally do not tell you what they can do for you! You have to ask.  Pending on your record, and how desperate the bank want to keep you (It is a shopper market now), you may get what you asked for.  No harm isn’t it?

Not sure where to start looking?  Click the latest housing loan package info below.

If your are like me, always put-off by the high sales charges when come to investing in unit trust, you might want to take a look at Fundsupermarket.com, a new online unit trust investing portal.

Given the current financial market turmoil, You might called it a wrong timing, but the launching of Fundsupermarket Malaysia by iFast Capital could be a long term winner for unit trust investors.   Fundsupermarket not only charge a lower front-end sales of 2% (vs conventional agent fees 5-7%), but it also gives investors a great freedom to DIY their investment portfolio directly.   More importantly, it provides access to analyst reports and updates - a good news to savvy and keen investors

Currently there are close to 70 funds available (Alliance, Prudential, OSK-UOB, RHB, etc)

The website is easy to navigate and to educate potential investors about online investing, it places a lot of emphasize on FAQs (since the internet is still relative new in Malaysia), and step-by-step registration.

Some of the features I find it useful and interesting are:

1. FAQs.  All together 13 different categories covering from “Getting started” to “Trouble shooting”
2. Fund Selector.  By selecting some parameters, you can streamlined the funds that suite your needs and it complete with detail pricing and historical performance information
3. Planning Calculator.  Here you will find a full array of planning and fund returns gadgets.  It could be fun.

More funds will be made available to Fundsupermarket.com eventually, though some are taking a wait-and-see stance. However, some plan to set-up their very own online platform  and this includes Public Mutual Bhd.  And very soon, Fundsupermarket will comes face to face with Tune Money, another low cost online fund portal, which is expected to be launched within the next few months.

Now, everyone can has a low investment cost.