Kuala Lumpur, Wednesday, 10 August 2016:-
The Association of Banks in Malaysia (ABM) would like to highlight that first time home buyers may want to consider applying for Government schemes such as “Skim Rumah Pertamaku (SRP)” for assistance in their property purchase. Eleven commercial banks and eleven Islamic financial institutions in Malaysia are participating in the SRP, the full list of which can be obtained on SRP’s website -> http://www.srp.com.my
Home buyers are advised to avoid obtaining more credit, which may not be sustainable in the long-term, and over-stretching themselves financially. There may also be hidden costs or charges which may not be apparent.
Generally speaking, homebuyers are reminded that there are various financing options for them. Commercial banks have been offering housing loans to applicants who are eligible. In screening housing loan applications, banks consider many different factors. The business of commercial banks is in the main lending or extending credit while adhering to their respective risk appetites and/or the guidelines set by the regulators. Consumers who are eligible will continue to be able to obtain financing.
To improve one’s standing of obtaining a housing loan, potential home buyers should pay close attention to the following factors:
- have a good credit record by keeping all payments up to date on existing credit facilities/liabilities.
- the ability to prove financial capability to make monthly payments.
- full and accurate disclosure of all material information with regard to their financial position when applying for a home loan.
- shop around for a financial institution. Each financial institution may offer different financing packages, so it is important to get loan estimates from multiple lenders before making a decision to make a purchase. Apart from commercial banks, certain Islamic banking institutions also offer home loans.
- know just how much one can borrow to purchase a property by checking with the bank. The borrower may also want to consider getting pre-approved for a housing loan before looking at purchasing a property. In assessing one’s eligibility for a housing loan, monthly home loan instalments and other long term monetary commitments such as hire purchase loans should not exceed more than 40% of gross monthly income.
Housing loan applicants should work with their financiers when making the suitability and affordability assessments for any facility applied for to pave the way for more robust financial management on the part of consumers. Our member banks are committed to playing their role in this process. Consumers are thus encouraged to shop around to find a financing package which best suits their needs.
Members of the public who may have enquiries or complaints related to housing loan matters are welcomed to contact us at our ABMConnect hotline by dialling 1-300-88-9980, or emailing us at eABMConnect by logging on to our website, www.abm.org.my