Is it true??

Ok, here goes. Let's say that I purchased a property of about RM100,000. Take away the 10% deposit, I'm left with RM90,000. Correct? So I what I need to do is to take a loan of RM90k from the bank. Let's assume the bank will give us a rate of 4.55% BLR-1.95%. Hence, for a RM90k loan, (let's assume that I'm 30) I will need to fork out a monthly payment of about RM460 for the next 360 months (30 years).

In short, I'll be paying the RM460 per month for the next 360 months to service the loans. That's like RM460x12=RM5520 per year. Let's total it up. RM460x360=RM165,600. Hrrrmm....from that loan of RM90k, the bank makes a profit of about RM75k...

Ok now, what if, I decide to change the method of payment a bit. Instead of paying RM460 per month (one time payment), I pay the bank twice per month. Huh?? For what? Hrmm...Let's calculate. We divide RM460 into 2 payments. RM460/2=RM230. Let's pay RM230 on the 1st day of the month and another RM230 on the 15th day of the month. In short, I'm paying the bank once in every 2 week.

Ok...for one year, we have 52 weeks right? So basically we have about 26 times of payment (52/2). So, 26 x RM230= RM5,980. Huh!! I'm paying more isn't it? Why would I wanna do this? Is it true that I can finish off paying the loans earlier? In theory, I'll be able to finish off paying the loan on the 27.69th year ( About 3 years earlier than the loan agreement).

What about the interest? Hrmmm......................Is it true that I can save on the interest as well? Something to ponder on later tonight..........

Have a good weekend