Q1. Apart from interest rates, what else should I consider before applying for a personal installment loan ?
When applying for a loan, customer should consider his or her own financial needs and conduct comparison of types of loans, repayment tenor, interest rate, terms and conditions, monthly repayment amount, method of interest calculation, early repayment charge and other related fees and charges.
For loan related fees and charges, customer can visit List of Service Charges for Loan of the Bank or Key Facts Statement stated in the application form. Customer can also visit Personal Installment Loan Repayment Schedule Sample of the Bank to calculate monthly repayment amount with reference to a mock loan amount.
Q2. Is it necessary to have a Fubon bank account for personal installment loan drawdown and repayment ?
Customers who have not maintained an account with Fubon Bank can still apply for personal installment loan offered by the Bank. Customer can provide other designated bank account with relevant proof for personal installment loan drawdown and repayment.
Q3. How much should I borrow ?
Customer needs to carefully assess his/her current and future financial condition, financial needs and repayment ability before he/she applies for the loan. Only borrow what he/she actually needs, not what he/she might want. He/she must also calculate his/her other expenses and make sure he/she can afford to repay the loan without shortage of money each month.
Q4. How long should I choose to repay the loan ?
In order to choose a suitable repayment tenor, he/she should carefully measure the loan amount he/she needs to borrow and repayment amount he/she can afford each month as repayment tenor affects the monthly repayment amount directly.
Q5. What is Annualised Percentage Rate (APR) ?
APR, calculated in accordance with the guidelines as set out in the Code of Banking Practice, is a reference rate expressed as an annualized rate which includes the interest expense, handling fee, interest rebate, cash rebate, etc. Actual cost of borrowing could be reflected by APR. The lower the APR, the lower the cost of borrowing.
Q6. What is the relationship between APR and the monthly flat rate ?
The conversion between the monthly flat rate and APR requires a complex formula for calculation. The APR is subject to change in the monthly flat rate, repayment tenor and the administration fee(s), interest rebate and cash rebate etc. Under normal circumstance, the higher the monthly flat rate, the higher the APR.
Q7. What else need to know after the drawdown of personal installment loan ?
Please remember to repay the loan on time to avoid extra charge and interest incurred due to late payment after drawdown of personal installment loan. For details, please refer to List of Service Charges for Loan or Key Facts Statement stated in the application form. Details of the interest and fees are also listed in loan confirmation letter which will be issued to customer after loan drawdown. Besides, late payment records will be maintained in the consumer credit data bureau. They will directly affect customers’ other loan applications in future and interest rate entitlement.
Q8. Do I save interest expenses by making early repayment of personal instalment loan?
Generally speaking, the earlier a customer makes early repayment, the more outstanding interest payments of personal installment loan are likely to be saved. Nevertheless, customers should consider the early repayment charges involved before deciding whether to pay off their loans early or not. Customers need to be aware that reducing balance method is used by the Bank to apportion interest and principal in the monthly repayment amounts. Even though the monthly repayment amount is the same throughout the loan tenor, more interest will, in general, be included in earlier repayments, and less on principal (Customer can visit Personal Installment Loan Repayment Schedule Sample to illustrate how the principal and interest are apportioned in the monthly repayment amounts with reference to mock a personal installment loan repayment example). In other words, where a customer has been making repayments as scheduled for some time, the amount of outstanding interest is likely to be small. If the customer chooses to pay off the loan early at this point of time, the loss may outweigh the gain as the amount of interest saved may not be enough to cover the relevant charges for early repayment. As a smart bank customer, one should first check with the Bank about the total amount involved in early repayment (including outstanding loan balance, early repayment charges and other fees, etc.) and the amount of outstanding interest. He/she should then compare different scenarios and consider carefully before making a decision of repaying early or not.
Customer can visit Personal Installment Loan Repayment Schedule Sample to show after which point of time the amount of interest saved by early repayment may not be enough to cover the relevant charges for early repayment with reference to a mock early repayment example.
Q9. How can I understand the details of Personal Loan at Fubon Bank Website ?
Customer can visit the followings to understand the details of Personal Loan:
To borrow or not to borrow? Borrow only if you can repay!