ING Insurance is now offering their lowest ever fixed rate home mortgage at 4.85% for up to 30 years. Compared to floating rate mortgage, the fixed rate option offers predictability as it is not subject to fluctuating interest rates which may catch property investors off guard.

ING Insurance chief investment officer Mark Wang said during a recent property financing briefing, “The fact is property still remains an ideal long-term investment choice for many, regardless of the market conditions. At the same time, what also persists is that smart investors do not like the uncertainties that will affect the value of investment and borrowing costs.”  

According to Wang, typical borrowers have a general misconception that ‘the lower the mortgage rate, the better’ when estimating their ability to repay their loan. While floating rate mortgage is also currently at their historical lowest, they may not stay low continuously as they are driven by Bank Negara Malaysia’s policy rate, liquidity and inflationary expectations.

This means that there is a possibility that loan repayments can be higher in the future should interest rates go up. Meanwhile, fixed rate mortgage is driven by the fixed income market and repayment amount is the consistent throughout the loan tenor thus allowing investors to reduce uncertainties.

“We expect the Malaysian economy to regain growth next year, and when that happens, there could be an upward movement in terms of interest rates and investors need to be aware now of other alternative mortgage loans which allow them to lock-in their borrowing cost and without having to worry about any increasing rates in the future,’ says Wang.

ING Insurance chief operating officer Isold Heemstra adds, ‘The interest rate is fixed at a certain rate throughout the life of the loan, which means that you will know exactly how much is going out every month on your home loan repayment. This stable interest rate is an ideal alternative for those who seek financial stability and have the desire to plan ahead.”

Heemstra added that home loans that are pegged to the Base Lending Rate (BLR) moves up and down with market interest rates which affect loan payment’s amount or length of home loan tenure. There is a possibility that borrowers may pay less should interest rate go down, but they could also be paying more should interest rate rise.

“With smart financial planning, it is easier to achieve your financial goals and dreams with the best fit mortgage package,’ summed Heemstra.

For more information about ING Insurance products, head on to www.ing.com.my.