DBS First to Offer Variable Interest Loans

[Sfchung]

On NST today. Claim huge savings! However, what they didn't illustrate is that there is a 4% penalty for full early redemption. Go to DBS website and see what I mean. (I can not imagine what processing charge is equivalent to 2 % of o/s loan. It is purely labour costs I would think and it would be the same whether the loan amts are big or small) However, the website did not say whether there is penalty for partial redemption. If there is no penalty for partial redemption, then the early redemption penalty has no effect cos you could prepay 99% of the loan first and pay the last $ later ie full redemption. Yeah, charge me 4% of a $...

 

Anyway, it is a good start for motorists as we have been screwed too long by the banks. Interesting to note that this product is offered when interest rates are going up. Wonder whether they will yank it off the mkt when interest rates start to decline???

[Midgoo]

Is this new scheme really help?

I'm not very sure how it work. Does it mean, we can pay anything we want every month? Say this month I'm rich I pay 1000, next month I'm poor I pay 100, as long as I pay everything at the end of the loan and I will not pay everything before the end of the loan?