Tag Archives: Mortgage Lock-In

Understand the Lock in Period for Your Home Loan

When you are applying mortgage to finance your house, I urge you to take some time to read every words in the offer letter and ask questions for thorough explanations from banker before you sign it. One thing you should aware of is the lock-in period. It’s the period when you do an early settlement of your loan in full for the first few years of your loan tenure; the lender can impose an exit penalty charge which ranges from 2-3% of the principal loan amount.

lock in period

For instance, if your principal loan amount is RM300,000, when you choose to settle the loan or refinance it to other bank, the amount you need to pay for penalty is:

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