The Malaysian Government declared a scheme in the 2011 Budget to aid young or first time home buyers some assistance to buy a home. This housing scheme is intended for first time home buyers who are Malaysian citizens and earn RM3,000 per month or less. This scheme allows first-time homebuyers to get financing for up to 100% through various financial institutions established in Malaysia and Hong Leong My First Home Scheme is one of them. Cagamas SRP Berhad guarantees that these banks provide financing for over 90%. In other words if the home loan applicant gets 100% financing, Cagamas SRP will make sure that 10% (from 90% to 100%) of the home financing is paid. This scheme is also known as the Skim Rumah Pertamaku scheme.
Features of the Hong Leong My First Home Scheme
- The maximum home financing tenure or in other words the repayment period should be 30 years or more but not more than 60 years.
- This scheme does not have any option to redraw from the amount already paid to the bank as repayments.
- The applicant’s Savings record is required which is the reserve for instalment liquidity for 3 months.
- The installment for repayment are to be paid monthly through monthly salary deduction or a standing instruction at the bank.
- It is compulsory to apply for a Fire insurance or takaful scheme when one applies for this scheme.
Benefits of My First Home Scheme from Hong Leong Bank
- The product is intended to aid youngsters to own their first home with a monthly income that is RM 3000 or less.
- The scheme offer home financing for up to 100%. However, the bank will finance 90% or more of the loan amount, whereas the remainder will be funded by Cagamas SRP.
- The plan is intended and applicable only for private sector employees.
- The scheme covers properties which are under-construction or completed.
- The home loan financing is available with regular banking as well as islamic banking laws.
- The borrower does not have to pay any down payment but must pay a booking fee or/and make a deposit under the terms of the Sale and Purchase Agreement pending disbursement to the seller of the property, for home financing, by Hong Leong Bank.
Eligibility for Hong Leong My First Home Scheme
Requirements of Applicant
- The applicant should be a Malaysian citizen.
- He or she should be purchasing a home for the first time.
- The applicant should not be more than 35 years.
- A single borrower’s gross income must not be more than RM 3,000 every month.
- The applicant should be a confirmed employee with a minimum employment of at least 6 months with the current employer (private sector).
- Obligations for all other repayment of outstanding debt from banks and financial institutions (includes companies that CCRIS does not cover) should be 60% or less of the applicant’s monthly income post statutory deductions such as EPF, Tax, SOCSO or the maximum limit suggested by the bank. The lower denomination is considered.
Requirements of the property requiring the Housing Finance
- The value of the property should be at least RM 100,000 but should not be more than RM 400,000.
- Property should be occupied by the owners.
- Properties that are residential in nature, can only be financed through this scheme.
- For the purpose of the leasehold, the remaining lease should be more than equal to 60 years.
Documentation Required for Hong Leong My First Home Scheme
The following can be submitted as proof of income:
- The latest copies of their 3 months salary slips.
- The individual’s latest copy of Borang BE which must be submitted alongside their tax payment receipt.
- The applicant’s latest copy of EPF statement may be submitted.
- He or she can also submit their 3 month bank statement or copies of their savings passbook with records of the latest 3 months.
- Employment or offer letter.
Fees and Charges
Interest rates applicable for loans from Hong Leong Bank include:
- BLR: Base Lending Rate (BLR): 6.95% as on 25/04/2016
- BR: Base Rate (BR): 3.94% as on 25/04/2016
FAQs on Hong Leong My First Home Scheme
Are there provisions for joint applications for this home loan?
The immediate family members can apply for this scheme together. However, their aggregate income per month should not be more than RM 3000 and they should be family members.
If we have already taken a housing loan from another or the same bank already, can we still apply for this plan?
No, this scheme does not have any refinancing or transferring an existing finance option.
If one of us joint applicants are more than 35 years, can we still apply?
No, both applicants must be 35 years or less.
Are there any extra charges or fees applicable for getting the Cagamas SRP Berhad's guarantee?
No this scheme comes with the Cagamas SRP Berhad's guarantee, as intended by the Malaysian Government and hence no charges for the guarantee are applicable other the regular home loan charges from the bank.
Disclaimer: All the figures and information, mentioned above are subject to change or scrutiny based on the bank’s policies and amendments. Please go through the application form and enquire when or before applying for this housing loan.