# Home Loans and Mortgage Financing in Malaysia

> A guide to home financing in Malaysia — financing margin, BNM's responsible lending guidelines, MRTA/MLTA, EPF Akaun Sejahtera withdrawals, the SJKP guarantee scheme and stamp duty on loan agreements.

- Category: property
- Language: en
- Status: published
- Updated: 2026-08-08
- Canonical: https://negaraku.md/en/property/home-loan-mortgage-financing

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Your dream home might cost RM450,000, but the bank will not hand over that money until it is confident you can pay it back over the next 30 years. That is where the world of mortgage financing begins — margins, debt-service ratios, insurance, EPF savings and stamp duty, all of which determine whether the keys to that house end up in your hands.

This guide breaks down each part concisely so you know how much you need to prepare and the rules that govern each step.

## How much will the bank finance?

The amount a bank is willing to lend relative to the house price is called the **financing margin** (or *loan-to-value*, LTV). For a first and second home, Bank Negara Malaysia (BNM) **does not set a margin cap** — banks offer according to their respective internal credit policies, and in market practice this is typically up to 90% of the house price, so you prepare at least 10% as a down payment.

What is regulated is the third home and beyond. Under BNM's macroprudential measure introduced in 2010, financing for a **third home is capped at a maximum margin of 70%** to curb speculation. According to BNM, "financing facilities for purchase of the first and second homes are not affected", while the 70% cap applies to a borrower's third home financing facility.

| Number of home loans | Financing margin | Down payment |
|---|---|---|
| First | Up to 90% (bank policy) | About 10% |
| Second | Up to 90% (bank policy) | About 10% |
| Third and beyond | Maximum 70% (BNM cap) | About 30% |

The actual margin for a first and second home depends on the bank's assessment of the property and your credit profile. For a RM450,000 house at a 90% margin, the loan is RM405,000 and the down payment RM45,000 — not including legal fees and stamp duty.

## How does the bank assess your affordability?

The bank cannot approve a loan based on margin alone. Under Bank Negara Malaysia's (BNM) **Responsible Lending Guidelines**, every financial institution must ensure that the borrower's income after statutory deductions, basic living expenses and all other obligations is still sufficient to cover repayment throughout the loan tenure.

According to BNM, the intent is that borrowers borrow within their means to repay the loan over its tenure and have a sufficient financial buffer to weather future increases in financing rates.

The two most important practical rules:

- **Maximum tenure of 35 years.** BNM sets this cap so that the loan is settled by retirement age — for example, a borrower aged 25 would complete repayment at age 60.
- **Debt-service ratio (DSR).** The bank calculates the ratio of your monthly commitments to your net income. There is no single official figure; each bank sets its own ceiling based on income after deductions.

To review your own credit record before applying, you can access your CCRIS report for free through BNM's eCCRIS system and make sure there are no arrears.

## Should I buy MRTA or MLTA?

Once a loan is approved, the bank typically offers (and sometimes requires) mortgage insurance that settles the outstanding loan balance if the borrower dies or suffers permanent disability — so that the family does not inherit the debt.

- **MRTA (Mortgage Reducing Term Assurance)** — coverage decreases in line with the shrinking loan balance. The single-payment premium is usually cheaper, but there is no surrender value if you sell or refinance earlier.
- **MLTA (Mortgage Level Term Assurance)** — coverage stays fixed throughout the tenure and may have a cash value. The premium is higher but more flexible if you change properties.

Compare the cost, portability and whether the policy is *assigned* to the bank before choosing.

## Can EPF savings help?

Yes. Employees Provident Fund (EPF) members under the age of 55 may withdraw their **Akaun Sejahtera** savings (formerly known as Account 2) to finance a residential property. According to EPF, the money may be used to:

- help with the down payment;
- reduce the outstanding home loan principal; or
- pay monthly instalments.

Withdrawals are limited to residential properties (house, apartment, condominium) — not vacant land or commercial property — and may be used for a first or second home. The maximum withdrawal amount is set by EPF according to a specific formula for each type of withdrawal (typically the lower of the financing gap and your Akaun Sejahtera balance); confirm the exact amount on i-Akaun before applying.

Applications are made through EPF's i-Akaun with the Sale and Purchase Agreement (SPA) and the loan approval letter attached.

## What if I don't have a fixed payslip?

The self-employed, gig workers and micro-entrepreneurs are often turned away by banks due to the lack of fixed income. The **Housing Credit Guarantee Scheme (SJKP)** — operated by Syarikat Jaminan Kredit Perumahan Berhad under the Ministry of Finance Malaysia — acts as guarantor so that banks are willing to extend financing.

Key features of SJKP (according to the MOF Manfaat Portal):

- **Financing of up to RM500,000**.
- **Tenure of up to 35 years**, with a two-generation loan option.
- **No deposit** for eligible buyers.
- Open to **Malaysian citizens aged 18 and above**, for first-time homebuyers (new, existing or auction homes for residential use).

Eligibility conditions include total repayment of all loans **not exceeding 65% of gross monthly income**, no CCRIS arrears exceeding two months within the last 12 months, and no negative credit record within 24 months.

## How much stamp duty must be paid?

A home loan agreement must be stamped before it can be enforced. The rate is **0.5% of the loan amount** under the First Schedule of the **Stamp Act 1949** (RM5 for every RM1,000). Payment must be made within **30 days** from the date the agreement is signed, and is processed through LHDN's e-Stamping system (STAMPS).

| Loan amount | Loan agreement stamp duty (0.5%) |
|---|---|
| RM300,000 | RM1,500 |
| RM405,000 | RM2,025 |
| RM450,000 | RM2,250 |
| RM900,000 | RM4,500 |

This duty is separate from the memorandum of transfer (MOT) stamp duty on the property itself.

For first-time homebuyers, in Budget 2026 the government extended the full stamp duty exemption — for both MOT **and** the loan agreement — for first homes worth **up to RM500,000**, until **31 December 2027**. For eligible properties, both of these duties become RM0.

## What's next

- Check your CCRIS report for free through BNM's eCCRIS before applying, and clear any arrears.
- Calculate the actual down payment: 10% of the house price + legal fees + stamp duty (if not eligible for exemption).
- If your income is irregular, explore SJKP eligibility with a panel bank before signing the SPA.
- Check your EPF Akaun Sejahtera balance and prepare the documents for a withdrawal application.
- Compare MRTA and MLTA options from more than one provider before committing.

*This article is general information, not financial advice. Consult a bank, property lawyer or licensed adviser for your specific situation.*

## Sources

- Responsible lending guidelines ensures borrowers' affordability — https://www.bnm.gov.my/-/responsible-lending-guidelines-ensures-borrowers-affordability (Bank Negara Malaysia)
- Measures in Promoting a Stable and Sustainable Property Market and Sound Financial and Debt Management of Households — https://www.bnm.gov.my/-/measures-in-promoting-a-stable-and-sustainable-property-market-and-sound-financial-and-debt-management-of-households (Bank Negara Malaysia)
- CCRIS Report — https://www.bnm.gov.my/ccris (Bank Negara Malaysia)
- Skim Jaminan Kredit Perumahan (SJKP): Kelayakan — https://www.sjkp.com.my/skim-my/kelayakan (Syarikat Jaminan Kredit Perumahan Berhad)
- Soalan Lazim (FAQ) — Pinjaman Perumahan SJKP — https://www.sjkp.com.my/soalan-lazim (Syarikat Jaminan Kredit Perumahan Berhad)
- Skim Jaminan Kredit Perumahan (SJKP) — Portal Manfaat MOF — https://manfaat.mof.gov.my/taxonomy/term/326 (Kementerian Kewangan Malaysia (Portal Manfaat MOF))
- Skim Jaminan Kredit Perumahan (SJKP) — https://www.malaysia.gov.my/my/topics/skim-jaminan-kredit-perumahan-sjkp (Portal Rasmi Kerajaan Malaysia (MyGovernment))
- 6 Jenis Pengeluaran KWSP Untuk Rumah — https://www.kwsp.gov.my/en/w/article/epf-housing-withdrawal (Kumpulan Wang Simpanan Pekerja (KWSP))
- Pengeluaran Mengurang/Menyelesaikan Baki Perumahan — https://www.kwsp.gov.my/en/member/house-withdrawal/reduce-housing-loan (Kumpulan Wang Simpanan Pekerja (KWSP))
- Budget 2026: Stamp duty exemption extended for first-time homebuyers — https://www.thestar.com.my/business/business-news/2025/10/10/budget-2026-stamp-duty-exemption-extended-for-first-time-homebuyers (The Star)
- A Guide To Stamp Duty On Loan Agreements In Malaysia — https://lpplaw.my/insights/e-articles/stamp-duty-loan-agreement/ (Edwin Lee & Partners (Advokat & Peguam Cara))

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