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Good evening,

probably you can do a comparison between:
1) 1.5% penalty of $42k: $630
vs
2) $42k at 1.55%. interest cost is $1342.50 for 4 years.

so redeem the loan fully could be a selection.

As you are not selling your house, most likely don't need a lawyer to handle.

But do send an email to the bank for further clarifications and to double confirm.

Hope my sharing helps in aiding in your enquiry. May I know how can I value add further in your property needs?

Best regards,

YT Tan
Property Kaki
You dream. I create. We make it happen!
Association of Chartered Certified Accountants Graduate
Singapore Accredited Mortgage Planner

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Hi,

You mentioned that both you and your spouse are working and are financially stable and have healthy savings. Why not explore the option of selling the property and move into asset progression? I may even be able to carve out a plan for you, so that you get to enjoy monthly passive income from it.

I am experienced and well-versed in both HDB and private transactions. I will be able to assist you in your property plans. Please get in touch with me for a more in-depth discussion.

Should you need require further assistance in matters relating to property, please contact me at my mobile 9748 6305  . I will be happy to assess and share with you the possibilities for you in the current market.

Thank you.

Best regards,
Robbie Chen
 9748 6305 
PropNex Realty Read More

Hi,

1) From a mathematics point of view:
Redemption penalty [1.5% x $42k = $630] < interest incurred [1.55% x $42k x 4 = $2,604]
is an obvious choice.

2) But in actual fact, it is not saying that you don't have to pay the $2,604 interest by paying a lump sum back to the bank.
It is just that you incurred an additional $630 by redeeming your loan.

3) Although the interest charge might not be the full charge of this $2,604, but I suspect it is not much lesser.

4) If you want to weigh the difference of interest incurred by doing full redemption, I would suggest you speak to the banker to find out the exact amount instead.

5) You won't need any lawyer to perform redemption.

6) What you are feeling now is just an emotional feel and has nothing to do with money.
7) By now with only 4 more yrs to go, it means you are paying more on your loan capital than interest. You may refer to your payment schedule to understand this.
Interest is getting lesser in the final few yrs and can be only a few tens of dollars.
8) The only advantage of doing redemption is that if you prepare to invest in more property and are able to get a maximum loan of 75% LTV.
9) Otherwise I would suggest you continue to service the mortgage.

Hope the above answer to your main concerns, but if there are more query, please feel free to contact me at 90110636  , or email: ling.ck7@gmail.com if more information is needed.
I'll be glad to assist.

Best regards
Ling CK
 90110636 
ling.ck7@gmail.com
https://R056727F.propnex.net/
https://www.facebook.com/Homesellerbuyer

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