Monday, October 09, 2006
[RealEdge] TodayOnline Forum : Transparent home loans
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| Transparent home loans Monday ? October 9, 2006 Letter from Melissa Yam Head, Loan and Property, NTUC Income I refer to the letter, "First 'discounts' then spirally rates", by Ms Angeline Lee and Mr Deepak Gurnani (Oct 5). The home loan schemes in the market are quite complex. Many financiers offer different board rates for their home loans. When the board rate changes, the customer may be confused and unsure if he still enjoys a competitive rate. NTUC Income provides an alternative to owners of private properties. We adopt a simple and transparent approach for our loan scheme. We have only one board rate for home loans on variable rates. This applies to all loans taken with us. As the board rate changes, we notify our customer in advance. They know clearly what is the interest rate they pay at any time. We revise our board rate in line with the market, but we try to minimise the frequency of changes. Our current board rate is 3.5 per cent a year, and has been effective since January 2004. We have not changed this board rate for the past 33 months. From Nov 1, our board rate goes up by a modest 0.25 per cent. The revised rate will be only 3.75 a year, probably among the lowest. We also offer a fixed rate scheme, which is 4.15 per cent a year for the first five years. After this, the interest reverts to the board rate. The customer can opt to switch to the board rate at the end of three years, under certain circumstances. We offer free processing, valuation and home insurance for the first year of the loan. For customers who switch over from another financier to our fixed rate loan, we give a legal subsidy of up to $2,000. More details are available on www.income.coop/ | |
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// posted by Shajahan @ 4:30 PM 