Base Lending Rate (BLR)

This is something that I have learned today. :)


If you currently have a home loan with a financial institute that is pegged to the Base Lending Rate (BLR), then you will know that the rate has increased and effectively your home loan repayments have also increased for the year 2006 and beyond. Based on our current economic environment, interest rates offered by financial institutions are starting to show an upward movement and this trend may continue for a while. Therefore, with the fixed rate home loan, you are assured that the monthly installments are fixed and you will own your house at the end of the tenure.

Over the last 26 years, BLR has gone up to the highest touching 12% p.a. and the lowest at 6% p.a. BLR currently stands at 6.75% p.a.

From the graph shown, 23 years BLR average is at 8.23%. The usual fixed rate home loan is at 5.75% can save you thousands throughout your loan tenure.

If you are considering a home loan, do consider this plan also. :)

- J