Buying a home can be one of the most stressful events in one’s life – especially if it is your first time. Where should you start? Can you really afford your dream home? What about all the legalities and the hidden costs everyone talks about?
Yes, it is an extremely stressful time. We understand, and we are here to help with these 10 most asked questions by our readers and fans. These questions are most likely running through your mind as you scroll through hundreds of property listings anyway.
Don’t freak out, read on!
1. How would I be eligible for housing loan?
Housing loan eligibility depends a lot on your monthly income and your existing loan commitments. It can be a personal loan, the dreaded but inseparable credit cards, or various other bank loans including softer ones like ASB.
The banks will run a check on your CCRIS report to view all your active loans and your payment status. Thus, it is extremely important to ensure all your loans and credit cards are up-to-date. Then, the banks will decide how much you are eligible for and your risk as a borrower.
To find out how much you need to pay based on the price of a home, use our home loan calculator Malaysia.
2. Should I refinance my home?
Many home owners do just that to get some extra cash — though it is very normal, you have friends, relatives and neighbours doing that, don’t do it for the wrong reason!
Here are three things you need to know about refinancing your property, according to HSBC Malaysia:
- You take advantage of your property’s rising value to obtain a larger financing amount.
- Your refinanced loan pays off your current housing loan.
- You are free to use the balance as you wish.
However, only do it if there is a valid reason why you need the money.
3. How do I save up for the down payment?
This depends entirely on yourself. Down payments usually make up 10% of the asking price, depending on your margin of finance (the total loan amount you are eligible for).
Don’t forget, this 10% can be withdrawn from the Account 2 of your Employee Provident Fund (EPF)! You can also consider other options to save the money with these practical tips from financial planners.
4. How can I get 100% housing loan?
If you are unable to save up 10% of the down payment, you can still consider buying a home through various government subsidised schemes, such as:
My First Home Scheme or Skim Rumah Pertamaku (SRP) – If your monthly income is RM5,000 and below, you have the option of getting 100% financing for a residential property
The government also strives to help the lower and middle income groups to afford their first home through the 1Malaysia People’s Housing Programme (PR1MA), which constructs and maintains affordable houses in key urban areas.