An opportunity to have extra money in the pocket?

FINANCIAL services provider Robert Foo from MYFP Services Sdn Bhd declined the deferment for a property-related company loan.

Another director Eng Meei Yu from the company had to contact the bank several times during the movement control order (MCO) to reinstate the standing instructions.

She manually paid the April installment and it was only in May that the standing instruction was reinstated.

“As a financial planner, during my contact with the bank, the bank’s advice was to pay monthly or pay in a lump sum.

“They will put the money into what they call advanced account.

“Your money is sitting there and only at the end of the six months, they will take the money to knock off your loan. This was what I was given to understand.

“I think the bank were unable to cope with the announcement.

“The calculation of interest is done on the computer so a bank’s back end computer system has to be very strong in order to handle such announcement,” Eng reckons.

This may be the reason why bank officers were initially hard-pressed to provide clarifications with regards the calculation of interest.

One may have to get someone from the housing loan and who is also dealing with the computer systems to get a clear explanation with regard the interest calculation.

“It is unlikely that branch level officers will be able to explain it; it will have to be someone from headquarters level,” Eng says.

Milan Doshi, author of several property-related books and who held several property talks when the market was sizzling hot about a decade ago, says most of the people he was in touch and who had bought into the property sector took the deferment.

“You will be looking for a needle in a haystack (looking for that one person who opted out),” Milan says.

“To many, be it property buyers or anyone who have taken it loan, it was an opportunity to take the money and enter the stock market. I hope they have not lost their money,” says Milan.

The FBM KLCI dipped on March 19, a day after the March 18. It has gone up about 26% at press time yesterday.

“Many of them looked at the deferment this way – ‘if the banks is giving (the deferment), just take it. Money in the pocket is better’, “he says, adding that many thought it stupid to pass up on a good thing.

MYFP services Sdn Bhd director Eng Meei Yu uses an analogy: ”You have eaten your breakfast and I am offering you some really good food. But you simply cannot eat it. It does not mean you are stupid.” —

LEE CHENG

“Many of them looked at the deferment this way – if the banks is giving (the deferment), just take it. Money in the pocket is bettter.” Milan Doshi