Good or bad? Divided opinion on the housing loan without CDI and payslip


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Many Malaysians would like to own a house one day, and the government has made it easier.

People who do not have a permanent job and a pay slip can take out a home loan under the Housing Credit Guarantee Scheme (HCGS).

The loan is made available through Syarikat Jaminan Kredit Perumahan Berhad (SJKP), which is 100% owned by the Ministry of Finance.

Prime Minister Datuk Seri Ismail Sabri Yaakob said the loan scheme is another government effort to help more people buy their own homes, including those who have difficulty obtaining bank loans.

SJKP offers financing up to RM300,000.00 (including MRTA/MRTT), with 100% guarantee of total financing from participating financial institutions.

Properties that can be purchased under the loan scheme include Perumahan Rakyat 1Malaysia (PR1MA) housing.

Those who do not have a permanent job and pay slip can apply with a confirmation letter from an authorized person.

The authorized person includes a category A civil servant (grade 41 and above), the chairman of the Village Development and Security Committee (JKKK), the penghulu, an elected official and a bank branch manager.

Opinions are divided on whether it is acceptable to give home loans to buyers who do not have a good credit rating.

Those who supported the initiative praised the government for its benevolence and attention to the needs of the people.

They said affordable housing should be a right, not a privilege.

At the same time, those who support the loan scheme have praised its ease of application.

Are we headed for a subprime crisis?

Despite the seemingly good news, some pointed out that terms and conditions still apply, such as Credit Reference Information System (CCRIS) registration and debt-to-income ratio.

Some claimed it was just a populist move ahead of the election.

Others doubt that banks give loans without payslips to support the request.

Some have raised the question of what will happen if the applicants do not repay the loans since they do not have a stable job, which is why the banks refuse to lend in the first place.

At the same time, some have questioned why the government can relax the conditions for obtaining a loan, but not the withdrawal of one’s own savings from the Employees’ Provident Fund (EPF).

Real estate consultant and property management professional Calvin Chai Kuen Keong said it was generally much more difficult for people without stable jobs and people on low incomes to get mortgages from banks.

The decision to buy a property is a serious financial commitment that should not be taken lightly. This will bind you to regular monthly payments for the next 30 years or more, so banks would much prefer borrowers with a stable income. Banks hate bad debts because it would hurt their profits.

Real estate consultant Calvin Chai explains why the ability of borrowers to repay their loan regularly is important to banks.

Chai said potential home buyers have always struggled to get mortgages if they don’t meet the required credit rating, because that means they usually have debt problems.

As such, it wouldn’t be a stretch to draw a comparison to the subprime mortgage crisis that hit the United States and lasted from 2007 to 2010 as homeowners failed to repay their loans.

The subprime mortgage crisis of 2007 to 2010 was due to the expansion of housing loans, including to borrowers who previously would have struggled to obtain bank approval.

Real estate consultant Calvin Chai explains why banks refuse loans to borrowers deemed high risk.

Chai said it would be more economically viable for the government to rent affordable homes, with the option for tenants to purchase the property once they are financially stable.


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