For many Malaysians with irregular incomes, obtaining a loan to buy a home can be a challenge. For some, it is even impossible.

Here’s where Malaysia’s housing credit guarantee scheme (SJKP) could help. SJKP is a government initiative aimed at assisting individuals without a fixed income – such as gig workers, small traders, fishermen, farmers and others – to own homes.

Through the scheme, the government provides housing-loan guarantees for those who find it difficult to secure financing through conventional channels.

SJKP helps by being a guarantor for these individuals when they apply for a housing loan, guaranteeing 100% of the loan or more, which provides an assurance to the lending financial institution.

Other details include:

• financing limit of up to RM500,000 (includes principle financing amount, mortgage insurance, lawyer’s fee and valuation fee);
• financing tenure of 35 years (two-generation financing allowed, which means your parents or children can also qualify);
• interest rate as determined by the financial institution.

Who can qualify?

• SJKP is open to Malaysian citizens aged 18 and above. In the case of two-generation financing, your children need to be 18 or older as well to qualify.
• You need to be a non-fixed-income earner.
• This is for first home purchase only, and covers properties that are newly completed, under construction, subsale or auctioned.
• Your total repayment every month for the loan cannot exceed 65% of your income. You will also need to maintain good credit records.
• The monthly income of the main applicant must not exceed RM11,000.

What documents do you need?

Before applying, ensure you have the following:

• sale and purchase (S&P) agreement, booking sheet, down-payment receipt;
• latest bank or deposit account statement (six months);
• latest income tax return / EPF statement (if any);
• employment confirmation letter (if relevant);
• NRIC copy;
• business licence, fisherman’s registration card, taxi permit or other relevant documents;
• declaration of self-employment.

Which financial institutions can you approach?

• Maybank (conventional and Islamic)
• Hong Leong (conventional and Islamic)
• Alliance (conventional and Islamic)
• MBSB Bank
• Bank Islam
• Agro Bank
• Affin Bank
• Ambank Islamic
• Bank Muamalat
• BSN

How do you apply?

Identify the property you wish to purchase, bearing in mind that it needs to be eligible as outlined above. You’ll also need to prepare the S&P agreement and down-payment receipt.

Include the above-listed documents with your application to the financial institution. Your declaration of self-employment will need to contain your name, IC number, source of income, average monthly income, business address, and years of business to be valid.

From here, the financial institution will evaluate whether or not your fulfil all criteria. If satisfactory, it will submit your application to SJKP for further review.

If approved, the financial institution will issue you a letter offer for the loan with SJKP guarantee.

This article was written by Su-Wei Ho for MyPF. To simplify and grow your personal finances, follow MyPF on Facebook and Instagram.

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