How to apply a
loan house
This page is to help young generations to buy a house
especially in Malaysia. With this page, you will saved a lot of times and
troubles from doing some research.
Understanding “First
Home Scheme”.
Before we start, do you know about “First Home Scheme” by
the government? That is the types of loan for youngsters who just started
working without any saving to buy a house at 100% loan amount (zero down
payment). But the downside of this scheme is the high interest rate. I recommend
not to take this scheme if you have saving and good amount of EPF 2nd
account balance to pay the down payment and any additional fee.
If you still
interested with First Home Scheme, please links below for more details:
Or you can continue
with this page for normal method without first home scheme.
Picking the Right House
1.
Choose a house design that meet your needs.
Always ask this questions to yourself before buying a house. (To determine
types of house you going to buy)
a.
Do you need this house for a long term?
b.
Do you need extra room?
c.
Do you need multilevel of house?
d.
Do you need extra land outside the house?
2.
Know your capability to buy house. (To determine
house price range that you can afford.)
a.
How much extra money can you spend for the
house?
b.
What is other commitment you need after buying
the house?
c.
Do you still have saving after buying this
house?
d.
How much you can save after buying the house?
3.
Know house area/neighborhood. (To identify the
house location).
a.
How far is the house from your working location?
b.
How far is the house from centre of town?
c.
How far is the house from nearest commercials
area?
d.
How far is the house from main road (heavy
density road)?
e.
How good is that neighbourhood? (area
density/good neighbour/robbery case in area).
f.
How good is the traffics to that house area
during peak hour? (to avoid/minimize heavy traffic jam).
Accepting the
house with the House Seller/Developers
Most of the house sellers/Developers will request for
deposit money/booking fee. Standard amount of booking fee is RM5,000. Take note
some booking fee is refundable (when is booking is cancelled) or use it to pay
some amount down payment. Method of payment must be clear and with proof of
payment so you won’t have any troubles in the future.
When doing bank inquiry
You can enquirer and survey all bank without spending any
money. Most of the banks will do house valuation to determine the house price.
Total bank loan approval is depending on the house valuation or the selling
price by house seller/developers which depending on which one is lowest. (Take note: you can re-negotiate with house
sellers to lower the price when the valuation is way below the selling price).
The bank also will evaluate buyer salary to determine maximum monthly amount
the buyer can afford. Few things need to consider when applying the bank;
- Bank interest rate.
- Maximum loan period (it is depend on the expiry
date of the lease of state land/land title of the house).
- Lock in period (the period where you can clear
total loan amount or if you plan to resell the house).
Take note that you only can do loan maximum 90% from the
total amount of loan approve. Example;
House Value (after house valuation) = RM500,000
90% from total amount of loan approve = RM500,000 x 90% =
RM450,000 (Maximum bank loan offer)
Total amount you need to prepare for down payment =
RM500,000 – RM450,000 = RM50,000
The lists of documents that you need to bring to bank before
you go bank;
- Copy of Lease of state land/land title of the
house (you can get it from house sellers/developers)
- 3-6 months salary Payslips
- Buyer / joint buyer copy of identifications
- Latest EPF statements.
You can check bank interest rate at links below;
What you need to understand when applying the house loan;
Some additional fees
to consider;
Take note that some bank allowed additional fees below to be
paid as financing (included into loan amount);
- MRTA = This insurance scheme is mandatory to take when
buying a house in Malaysia, this insurance will cover the remaining loan
balance when the buyer (loan applicants) losing the ability to work due to
accidents. (amount varies from RM5000-RM20000 depend of types of house and loan
durations).
- Legal Fee = The amount of fee you need to pay to your
lawyer.
- S&P documentations fee = The amount of fee you need to
pay for the documents preparations. Usually this will be included into Legal
fee.
- Valuation Fee (only to be paid to house evaluator once loan
is confirm) = Price varies depend on types of house.
When do some Sales and Purchase agreement with the lawyer
firm. Make sure to include deposit/booking fee so you can deduct
remaining balance to be paid to sellers/developers.
This
blog is written based on author experience. If you have some thought or
better idea to share, please write in comments section. Thanks.
