This Scheme Helps First-Time Homebuyers Without A Fixed Income Secure A Housing Loan

It benefits both non-fixed income and lower fixed income earners, such as freelancers, taxi and e-hailing drivers, and more.

Cover image via @123rf via iProperty & @vantaymedia (Unsplash)

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This Spotlight is sponsored by Syarikat Jaminan Kredit Perumahan (SJKP).

It's not uncommon for Malaysians to face difficulties when it comes to buying a home

From downpayments to monthly instalments, you typically need to be financially stable and earn a steady income to apply for a housing loan that shoulders most of your expenses.

Plus, rising costs of living and stagnant wages mean that many are finding their dream of homeownership increasingly out of reach.

For Malaysians without a fixed income — gig and freelance workers, independent business owners, small traders and entrepreneurs, online sellers, e-hailing drivers, and more — it's even tougher to meet conventional requirements for securing housing loans.

Recognising the struggle for homeownership, especially for those without a fixed income, Syarikat Jaminan Kredit Perumahan (SJKP) was established in December 2007.

On 29 October 2021, a whopping RM2 billion was allocated in Budget 2022 for the scheme to serve its purpose.

SJKP is a wholly-owned company under the Ministry of Finance.

Its primary function is to manage a housing credit guarantee scheme that assists first-time homebuyers, who do not have a steady income or earn a relatively low fixed income, in aquiring financing facilities provided by participating banks.

Here are its key features:

1. Purpose of Financing
- Mortgage financing

2. Financing Limit
- Up to guarantee coverage limit of RM400,000 (including Principal Financing Amount, MRTA/MRTT, LTHO, solicitor's fee, and valuation fee)

3. Facility Type
- Term loan and term financing

4. Financing Tenure
- Up to 35 years or the tenure of the loan financing, whichever is earlier (two generation financing allowed)

5. Guarantee Coverage
- 100% guarantee of the Principal Financing Amount, MRTA/MRTT, LTHO, solicitor's fee, and valuation fee obtained from participating financial institutions

6. Interest/Profit Rate
- As determined by the participating financial institutions 

7. Deposit
- Mandatory deposit equivalent to three months monthly instalment

This scheme aims to assist first time homebuyers including non-fixed income earners such as taxi drivers.

Image via Yusof Mat Isa / Malay Mail

Here's a closer look at the requirements to be eligible for the scheme:

1. Malaysian citizens aged 18 years and above

2. For the purchase of first new residential house, existing house (sub-sale), or auctioned house which is to be occupied by the owner. Open to newly completed, under construction, sub-sale, or auctioned residential property.

3. The total repayment of all loans by the applicant does not exceed 65% of their gross monthly income

4. Central Credit Reference Information System (CCRIS) record of arrears of not more than two months within a period of 12 months

5. No other adverse credit records within the last 24 months

*Other terms and conditions may apply

Here are the documents you will need to prepare:

Sale & Purchase Agreement
- Booking sheet
- Downpayment receipt

Bank or deposit account statements for the last six months (if any)
- Latest Income Tax Return
- EPF statement
- Income confirmation letter

Other supporting documents
Photocopy of IC
- Employment confirmation letter (if any)
- Business license, fisherman's registration card, or taxi permit (whichever is applicable)
- Declaration letter on self-employment or income stream duly confirmed by Jawatankuasa Kemajuan dan Kemakmuran Kampung (JKKK) or Category A government servants, penghulu, ketua kampung, or bank branch manager

Eligible individuals can obtain mortgage financing of up to RM400,000, which is guaranteed by SJKP, from participating financial institutions

This includes Agrobank, Bank Islam, Bank Muamalat, Bank Rakyat, Bank Simpanan Nasional, RHB Bank, and more. Find the full list of participating banks here.

Participating financial institutions will first evaluate and review the credit application of potential borrowers, before submitting it to SJKP.

Once SJKP reviews the application and provides the guarantee coverage (subject to fulfilment of terms and conditions), the bank will extend an offer letter to borrowers, along with financing for their home.

And, whether it is husband and wife, or parent and child, the scheme allows for joint applicants, as well as two-generation financing, where the latter can be applied to extend the repayment period.

Visit the Syarikat Jaminan Kredit Perumahan (SJKP) website for more information

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