Mortgage loans are loans that you take to purchase a property. In Malaysia, there are many financial institutions and lenders that offer mortgage loans at attractive rates of interest. Let’s take a look at the different mortgage lenders in Malaysia and how you can secure this type of financing easily.
Most people prefer going to a well-known bank to get a loan. Not only do they help you throughout the whole application and approval process but they also provide round-the-clock customer service.
In Malaysia, there are a number of local and international banks that provide excellent loans at various rates of interest.
However, before applying for a loan, check how much financing you are eligible for by using home loan eligibility calculators. Then, compare the various home loan schemes offered by each bank and shortlist one that suits your requirements.
Banks usually charge stamp duty, as per the Stamp Duty Act of 1949 (revised 1989). Apart from stamp duty, you may be charged processing fees, redraw fees, termination fees, and legal fees. However, the commission charged is much lesser than other financial lenders.
To get an approval from the bank you need to fulfil the eligibility criteria as per the bank’s discretion. Also, you need to have a regular income, a good credit score, and no outstanding debt.
Sometimes, when you find it difficult to choose a home loan from the available options, you can approach a mortgage broker. In Malaysia, you will find a lot of mortgage brokers operating on behalf of banks. You have to check if they are licensed, their years of experience, and how many people they have helped to get a loan.
These brokers are intermediaries, who have exceptional knowledge of various loan schemes. For instance, if you are a first-time home buyer, but you aren’t aware of the government’s First House Deposit Financing Scheme/Skim Rumah Pertamaku (SRP), the broker will help you apply for it.
Applicants who have a poor credit score, outstanding debt, existing loans, and irregular jobs usually approach moneylenders as they can help them get a loan easily. However, the rate of interest will be higher than usual.
Moneylenders known as Ah Longs in Malaysia have a reputation for lending money at a high rate of interest and harassing borrowers when they default on a loan payment. Unlike the Ah Longs, today there are licensed moneylenders in Malaysia who are authorised by the government to offer financial services, legally, in the country. There are certain laws in place regarding how they need to operate and how much rate of interest they need to charge for their services.
Unfortunately, licensed moneylenders offer a lesser financing amount. Even though the rate of interest they charge is regulated by the government, it is still higher than what a bank and a mortgage broker offers.
Before choosing a moneylender, you need to check if they are licensed, how many years of experience they have, and how many individuals have successfully got their loans from them.
Malaysia Building Society Berhad (MBSB)
MBSB is a building society that offers mortgage loans, especially for those with a poor credit score. It’s also available for applicants who have had their loan applications rejected by multiple banks. The building society is licensed by the Central Bank to provide both conventional and Islamic forms of banking.
The mortgage loans offered by MBSB come at competitive financing rates and are applicable to both properties - under construction and completed properties. They offer a high margin of financing, and the approval process is quick and hassle-free. Also, they don’t charge early settlement charges and any extra fees. You can choose them to finance a residential or a commercial property.
No matter what type of mortgage loan you are applying for, it is advisable to do a proper research on the various options available before applying. Check what type of loan you are eligible for, how much financing you need, and what type of loan is best suited to your requirements. If you are looking at lower rates of interest, you can opt for a loan scheme from any of the banks in Malaysia. If you have a poor credit score, you can borrow money from other lenders.