Home Loan for 3rd Property

With effect from 5 November 2010, the following Bank Negara Malaysia's rules will apply for home loan submissions:

1. Definition of 3rd home loan

Borrower still have 2 active home loans in the credit reference record.

2. Margin of Finance (MOF) for 3rd property:

For single borrower

Borrower A = 2 existing active home loan

New Loan = 3rd Home Loan MOF is 70%

For joint borrowers

Existing Home Loan in credit reference:

Borrower A = 1 existing active home loan

Borrower B = 2 existing active home loan

Borrower A + B (Joint borrowers)

3rd Home Loan is 70% of MOF

3. Refinancing & Full Settlement

Scenario 1: Refinancing

• New Loan to refinance, this application will be considered as the 2nd loan;

Scenario 2: Full settlement

• New loan to finance a new property but borrower has sold off the property;
• New loan will still be considered as a 2nd loan if the sales and purchase process not yet completed;
• Condition : Creator to provide proof of sale - Sales & Purchase Agreement OR down-payment of sold property to their financier.

4. If the home loan in credit reference has an outstanding balance of '0' but the limit is still available (meaning the home loan account has not been closed), this account will be treated as '1' home loan, unless customer has proof of account closure from their financier. Approval for such cases will be granted under deviation.

And lastly, to avoid getting delay on home loan application, check with your existing home loan financier if you plan to get a new home loan or refinance existing home loan, make sure that they have closed your existing home loan account and better still, issued you a piece of account closure statement.

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