Sunday, May 31, 2009

Why I chose to apply for an overdraft (OD) instead of a personal loan

  1. As a bumiputera, I have a slight advantage in using my ASB cert as a collateral in order to apply for OD
  2. Current interest rate (BLR) is low. Today, it stands between 5.55 and 5.65 (depending on banks)
  3. OD is calculated on a daily rest vs. monthly rest in most conventional loans
  4. Ability to control cashflow (money going in and out) of the OD, at the same time manipulating the interest charge on the balance
  5. Lower application cost or processing fee than most conventional loans
  6. No fixed tenure (repayment years) to settle the outstanding balance
  7. I stand to gain the dividends and bonus from the ASB cert that I use for collateral


If you satisfy all of the above reasons, make sure you apply for an OD rather than a personal loan. Later, I'll post the current rates and OD facility by the main banks in Malaysia.

For those who do not know what an ASB cert is, the above is a sample of a cert converted from an ASB Book. You can convert any amount of your ASB savings to a cert at the PNB offices/branches. Only then you can use it as collateral when applying for OD.

3 comments:

Wan said...

Pasal OD n ASB ni aku ada dgr 2 thn lepas... tapi tak implement pon lagi... sbb blom ada duit sedebuk nak masuk ASB.

renovaterumah said...

my friends are talking bout this now.
but i'm not sure..
how much the fees we need to incur?
which bank offer best rate?
need to start doing research i guess

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