Why loan?

8 11 2016

Most people are so fearful about the property market bursting right now. Anyway, I still think that Malaysia property is worth purchasing, because of some very simple facts:
1. Young population:  as more people are born, land size remains the same. Property value will rise when the supply can’t keep up with the demand
2. Favourable financing option

Let me elaborate more on why this favourable financing environment benefits those who buy properties. As you know, there are two types of return a property can produce, whether you are buying it for own stay or investment. Read the rest of this entry »

Wrong Perception about Debt-by KC Lau

8 11 2016

Wrong Perception about Debt

The first wrong perception is that debt is considered evil. Some common advice are:

  • settle your housing loan as early as possible
  • don’t borrow to invest

Your parents told you to settle your housing loan ASAP. My parents used to say that too because they bought their only home with 50% cash, and the remaining loan was settled within 3 years! Even financial planners tell you to clear your debt.
However, the fact still remains that most rich people I know use some form of debt leveraging. Debt is a constant in their lives, whether it is to a expand business or to invest in properties. Some “property gurus” I know have more than RM10 million in mortgages.
But before you go borrow as much as you can, you must know how to make better investment return with the cheap money you borrow. If not, you are destined for disaster. Read the rest of this entry »