A Personal Finance Blog for Malaysian: Loan of 100% of the property value

Wednesday, October 20, 2010

Loan of 100% of the property value

Quite a surprise that this policy was made by the BN government to help the low income earner to buy their first home.

If you earn below RM3,000 (may be RM2,999.99) and qualify for this, what would you do?

Assumed you earn almost RM3,000 and get a maximum 100% loan of RM220,000 and interest rate move to 5.00% .... your installment (RM1,181) to income ratio (RM2,655)  is 44.48% - quite a high ratio for any bank to accept.

Therefore, it will be advisable to look for property value RM200,000 and below.

Anyhow, lets wait and see the detail guideline on this policy.

Will this policy accelerate the forming of property bubble or create a different level of bubble?

* Some people are expecting the BLR will be adjusted (upward) again in year 2011.