Statutory Guidelines

Here's a brief guide on how to apply for a housing loan.

Consider the interest rates offered
Most banks offer interest rates that vary from one another. Therefore, you should carefully scrutinize the rates offered as well as the period of the offer. Look beyond the initial interest rate as in some instances, you may be paying more interest in the future. It?s also good to check with the bank if the rate is a fixed or floating rate.

Required documents
When applying for a housing loan, prepare the following documents for the loan process:

  • A copy of your identity card or passport
  • Your latest 3 months' salary slip
  • Your latest income tax return form (form J) or EA form
  • Sale and Purchase Agreement/deposit or booking receipt/letter of offer from the housing developer
  • A copy of the land title (if any)
  • Latest bank statements (compulsory in the absence of salary slips and/or Form J/EA Form) dating back six month/savings passbook/fixed deposits
  • Valuation report for completed houses

 
If you are self-employed, you will need to provide in addition to the above your:    

  • Business registration documents
  • Latest financial statements
  • Other supporting documents required by the banking institution

Fees and Charges
Processing your loan application may incur related costs such as professional fees and government charges which you have to bear. Please note that these fees and charges are subject to change in the future. Therefore, you should always seek advice from your loan officer with regard to the fees and charges.

Flexible Loan Repayments
Banks offer a variety of flexible loan repayments to suit your financial standing. You can speak to your bank officer about the following loan repayments:

  • Graduated payment scheme
    This scheme allows lower instalment payments at the beginning of the loan and will gradually increase over time. If you wish to allocate more funds for other purposes, this is the scheme you may consider taking.
  • Prepayment flexibility
    Some banks allow you to make prepayments or extra payments so you can save considerable interest charges on condition that you make prompt monthly repayments..
  • Partial prepayment of the outstanding loan
    Some borrowers find it useful to shorten the loan tenure by making partial prepayments with surplus savings or annual bonus. This effectively reduces interest charges if prepayments are made during the early years of the loan tenure. 

For more information about housing loans, visit www.bankinginfo.com.my