after m'sia government review BLR, my housing loan interest rate drops from 6.75% to 6.5%. (thanks for hsbc bank drop 0.25%, i check with some other banks, their BLR drops only 0.2% which is 6.55%).
ding~~~ sth comes to my mind!!
since the housing loan interest rate drops while car interest rate holds still, how if i withdraw the housing loan money (my housing loan is fully flexible package, can withdraw money which i pay extra earlier at any time without inform) to make a full settlement for car loan. can this method save money for me? how much can i save if i make a full settlement for my car loan? from my understanding, the car loan is hire purchase, so interest rate calculate method is different from the housing loan.
after making research from the web, i came out with the conclusion tat full settlement of car loan now give a better value.
| Settle Car now | Settle Car 3 year later | Settle Car 5 year later | |
| Car Loan Total Pay | $ 3,556 | $ 18,288 | $ 30,480 |
| Housing Loan Total Pay | $ 25,244 | $ 23,231 | $ 0 |
| Total Amount Pay | $ 28,800 | $ 30,218 | $ 30,480 |
actually i can save rm1680 for about 5 years (roughly rm330 yearly) but the most important is tat i no need to go 2 banks to make payment every month, and it could save lots of trouble from me.
well, this case study is only applicable if BLR remains at 6.50% in the coming 5 years. if BLR rises, i might lose. if BLR drops, i could save more. it looks like a gamble, yet i dun foresee the BLR would rise in the coming 2 years.
wonder if my calculation is correct as my engineering background, can any1 from account or finance enlighten me?!
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