Bank Negara Malaysia (BNM) has expanded the eligibility criteria for first time home buyers looking to buy a house via the RM1 billion Fund for Affordable Homes scheme.
The nation’s central bank has made two changes that will allow more Malaysians to apply for this scheme. The first is the expansion of the maximum monthly household income to RM4,360, while the second change is increasing the maximum property price applicable under this scheme to RM300,000.
Previously, the maximum household income was set at RM2,300, while eligible properties needed to be below RM150,000. Essentially, Bank Negara Malaysia has increased both eligibility criteria by almost double their original amounts.
Both these changes would kick off from 1 September 2019. After the announcement, Finance Minister Lim Guan Eng said this enhancement, along with the scheme's extended mortgage duration, may increase homeownership by as much as 20%.
Established in January this year to assist the B40 group with purchasing their first property, the Bank Negara Malaysia RM1 billion Fund For Affordable Homes has a longer mortgage repayment tenure of up to 40 years (or when the applicant reaches 70 years of age, whichever is shorter), while the maximum interest rate is capped at 3.5% p.a..
Besides the two changes, BNM has retained the other eligibility criteria that applicants have to meet: that they are Malaysian citizens, employed, and have a clean financial record for the past 12 months.