I do not personally believe any bank would want to reject home loan applications if the buyers qualify for it. However, as usual the buyers these days also have to bear some responsibility for having their loans rejected. This is especially if they have overspent via their credit cards even before they apply for their first mortgage. Secondly, many of these buyers are also unwilling to buy further away and everyone just want to buy a condo in an area everyone wants to buy. For everyone’s information, my first home was just an apatment of 700sq ft and it is in Relau, an area considered unpopular for ‘face.’
In an article in The Star, The Association of Banks in Malaysia (ABM) says first time home buyers who are eligible will continue to be able to obtain financing. In fact it reiterated one major reason why the loans may be rejected; buyers must ensure they buy based on their financial circumstances or affordability. It said, “The business of our member banks is in the main lending or extending credit. There is no intention whatsoever to make lending more difficult, particularly for first time home buyers.” It has had to defend its members because of the many fingers from different parties pointing at them as the major cause why many buyers were unable to obtain loans for their first property. ABM further pointed out that most of the time, if it’s for first-time home buyers, the banks would usually lend up to 90 percent of the property price.
Actually, besides the new launches, there are also the secondary choices. Besides these, there are also the state and federal government affordable homes schemes. Sometimes, the distance may be a little far or the area is not the most popular ones but it is best to take a longer term view when we are thinking affordability. Truth is, even for the popular areas, the properties were once affordable. Who knows, perhaps in the near future, the centre of the ‘popularity’ may shift? Just look at those huge integrated developments which the developers tout as ‘city within a city.’ Of course, we can always buy the developments NEXT to these for a more affordable tag if we think the integrated ones are way too expensive. Choose and decide objectively. Happy buying.
written on 17 Nov 2015
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