What do I need to know about Public Bank Home Equity Financing-i?
Public Bank Home Equity Financing-i is a housing finance plan based on the syariah concept of Musharakah Mutanaqisah (Diminishing Partnership), one of the options available from the "5 Home Plan" package. The interest rate is variable, tied to IBR. Depending on your circumstance and income you can choose between a full flexible or semi flexible package. Both the semi-flexi and full-flexi versions allow you to reduce your loan principal with any additional cash you deposit. What's more, you can withdraw any extra cash paid.
As an added bonus you'll get a free credit card you're approved and free personal accident coverage with RM10000 for the first year.
If you need it a higher margin of financing is available. You can go up to 100% if you include Zero Moving Cost (ZEC), such as MRTA and legal fees, in your total financing. Of course, approval is subject to a credit check.
What is the difference between semi-flexi and full-flexi Equity Financing?
The full-flexi version links your home loan account to a current banking account, so you only pay interest on the sum of your outstanding loan principal minus the balance of the current account. Used wisely this can save you a lot of money if you keep the current account in good credit. Naturally, you can withdraw funds whenever you wish, there are no limits and no fees for doing so. You will be charged RM10 each month for the current account and a onetime set up fee of RM200.
For the semi-flexible version the principle is exactly the same, only the method of banking is different. You may only withdraw funds once a month, you need to make an application at the bank to do so, and you'll be charged an RM50 fee for each withdrawal. That's a good incentive not to withdraw funds too often.
Which is best for me? A Full-flexible or Semi-flexible home loan?
If you have a fixed income and you don't like paying bank fees, or are certain that whatever money you bank in extra you will not bother to touch it again, then the semi-flexible option may be your best option.
On the other hand, if you have an irregular income, because you rely on commission as a portion of your salary, or because you are self-employed you may prefer a fully flexible home loan. Bank in money when times are good to create a buffer for yourself, withdraw slowly in times of need.
Do I need to buy any insurance?
Yes. Homebuilding Takaful (Fire Insurance) is compulsory. The premium is charged annually. MRTT is optional.
What kind of documents do I need to apply for this home loan?
Get a copy of the Application form from the bank and complete it
A copy of SPA / Booking Receipts / Letter or Offer from Developer
Copy of MyKad (front and back)
Latest 3 to 6 consecutive months salary slips or vouchers or
Latest EA From
And one of the following:
EPF Statement ( latest not more than 1 year) or
Latest Tax Returns and Tax Receipts or
Employment Letter or
Last 3 months Bank Statement or Saving Passbook
Copy of MyKad (front and back)
Last 6 months bank statements or
Latest 1 year Tax Returns and Tax Receipts