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This post has been edited by Xai-V-iaX: Dec 13 2011, 10:52 PM

not necessary good cos the financial institutions not able to judge your repayment ability and status.....for example, they don't know if you always pay on time or not given that there is no record

2nd this. No record doesn't mean goooood, owing some of money but paying deadly on time will be better

Basic of RM4000, probably nets you a loan of RM300k-380k for 30years

You need to pay
Downpayment of house
SPA Legal Fees + Stamp Duty + Disbursement
Loan Legal Fees + Stamp Duty + Disbursement , Valuation (if there are any)
Maintenance/Sinking Fund Deposit
Touching up of the house, renovations, furniture bla bla bla,

Thanks for the heads up...how about Graduate Home Loan Schemes? Is that an option?

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Added on March 30, 2010, 8:39 pmWell thats something new. Having an clean slate of neither outstanding debts nor any financial commitments doesn't work towards any benefits then huh....

This post has been edited by Xai-V-iaX: Mar 30 2010, 08:39 PM

I would say closer to 250,000 RM mortgage, on the basis of the 1/3rd Gross Income rule.
Don't over stretch unless you have a generous family!

Heard that the there are financial insitutions offering upto 50% of basic salary coverage for repayment....

Its better to have a credit card, where you spend and repay back regularly. This shows that you are a good paymaster. However, this shouldn't affect your chances of getting a loan too much.

As for the graduate loan schemes, I'm not sure if you are still entitled for it, you have to ask the banker. These loan schemes usually allow you to have a lower, fixed -% BLR rate for the entire tenure.

For your case, I think its better to take flexi-loan. This is because you can easily dump in money when you get your bonuses, and also increase your monthly installment when you have pay increment.

Bear in mind that due to BNM ruling, there's no more ZEC/ZMC loan packages anymore.

Please include MRTA in your plan as well.

1/3 rule is about ideal, but 1/2 is about the max you should stretch. Any higher than that its actually quite risky already.

Hi Xai-V-iaX,

Just PM'ed you.

Hope to hear from you soon.

Regards,

I'm quite surprised that BNM has abolished the ZEC/ZMC loan packages.

Yes, it is allowed.

Generally not advisable, unless, you are financially discipline and have some financial reserves (for when you are out of work, and when there's a
sudden spike in expenses for the month etc)... This will also mean you may have difficulty applying for other loans such as personal loan, car loan etc.

Again, with BLR rates expected to rise in the foreseeable future -> means your repayment MAY rise (if the flexible variable rate mortgage is chosen), over stretching yourself is not advisable.

I have seen this many times...

Thanks for the sound advice. Seems like its kinda almost impossible to generate an loan amount around RM600k with the figure I'm earning at the moment. Wonder how do people still could afford to pay or apply for higher loan judging by the fact that property prices at a decent established area are rising constantly.

by getting an extra party to be the guarantor

How about having an co-borrower?

co-borrower = guarantor

you can have persons A, B,C taking up one loan package but have only A's name on the SPA.

Owh ok...that's something that I have overlooked. So in my situation now, what would be the ideal choice assuming I would be needing an loan figure of about RM600k - RM650k? Lets say I have an co-borrower with earning strength of RM2.5k (monthly salary) + RM1.5k (fixed investments income), would that be sufficient for me to get an loan around the desired figure that I'm looking at....?

its quite possible.

id suggest to not take MRTA if you have sufficient financial backings to cover the property in the event of any unforeseen circumstances. itll just skyrocket the interest paid to the bank (extra commission to the loan officer).

the advertised interest rates can be negotiated. it just depends on your skill to lower it down.

Hmmm, I'll take that point into consideration. How are the interest rates currently? Also, when you say negotiate the interest rate with the banks, how are this normally done? Negotiate with the manager? Under what circumstances would this negotiations be successful? What are the pints that needs to be aired to wrestle for an better interest rate?

if you could speak to the manager then its an instant answer else youd just have to wait for a reply from the loan officer.

interest rates are quite low so its going to be a difficult time asking for better figures unless you have a leverage.

You mean negotiating the loan deal with manager could be faster in terms of processing period?

With the earning of RM4k (even with no other commitment), isn't it a bit quite heavy / burden to buy a property of RM450k to RM600k?

Buying a house worth RM450k - RM50k (down payment), and max out your loan period, I think repayment per month is about RM2k.

So RM4k (don't include EPF and income tax deduction) - RM2k = RM2k left for food, petrol, savings etc.

Since you mentioned that you are planning to stay in the house, unless you have big cash reserve or a family who can backed you up, my opinion is RM450k to RM600k for your income is a bit out of range.

Some issues for you to consider: Earning RM2,500 -> Just got a new job, new salary RM4,000 -> Buy a property RM450k to RM600k = A bit high risk. What if your new job is not stable / loose the job? How many months of cash reserve do you have if you loose your job and able to pay your loan + living expenses?

You can always buy a smaller house now and upgrade to a bigger house later on.

Just sharing my opinion ya... not intending to put cold water

Thanks for your advice/opinion bro.....Well to be honest, I'm having a tough time finding for an decent property within the price range of RM300k-RM350k. If at all its availablem they are all quite far away from the reaches of my daily route to work. I have been travelling approx 100KM on a daily basis to get to & back from work. At such, I'm looking at options that could reduce my travelling time & expenses vastly. These properties where I have identified as an potential buy are basically very near in terms of distance which is why I'm favouring them.

About your comments on losing/instability of my new job. Well, I'm an high-risk taker bro. Life s all about confidence, without it you'll end up in dire straits. I say it with confidence that I'm capable of sustaining the new career that I'm about to embark on....similiar to my selection of properties. Confidence on what you have chose, YES it may be dire to say that the monthly commitments would be straining nut if makes you happy with the purchase you've made - don't you think it'll drive you even more to reach greater heights in terms of earning power?

if you have 20% downpayment and a good record

My 2 cents from my house purchase.

Even dumping a 50k down payment, the monthly repayment really take a toll on you. Some of the finer things in life you enjoy before paying for the house loan, you may need to sacrifice a bit. If your partner is earning another 4K, I guess it will be fine..

But in the future you need to take into consideration of children (if you plan to have one). Children will cost a lot (diapers, milk, check up etc...)

how about cars? do you need to upgrade your car in the future?

unless you own a side business that give you side income, you'll be fine i guess...


just to share my experience purchasing a 344k house with 4.5k salary.

cheers

i would also suggest a smaller house. maybe an apartment or condo around the range of 200k to 300k, that would work well for you as, even when u upgrade to another house, when u letgo your property, u can get a much higher price, and a higher chance of selling the property as well.
Even if u dont feel like letting go. you can later give it out for rental, and your rental would be able to cover your monthly on the unit.
if you buy a landed property now. it wont appreciate as much as a condo or an apartment ( assuming that the condo is in the right location).

plus. the bank wont consider your 4k salary as yet. u need to be able to show at least 3 months pay slip with 4k. if not they would only look at u as earning 2.5k.

im sure many here agree that you should not take on such a property with your salary.
feel free to pm if u want to discuss further about it.

i 2nd that. its quite risky to take a property within that price tag, for your level of salary. you mention you got 50k to downpayment, but 10% of deposit is already 45k - 65k (let say the house is 450k - 650k), i don't think another 5k is enough to cover all other expenses like legal fee, notis taksiran, renovations, etc.

brand new units, so money to be considered for renovations may easily goes 20k - 30k at least.

additional costs: even when I got ZEC loan, i still have to fork at least 3% for other fees. nowadays don't have ZEC. 8% maybe?

my experience of buying house with lower price tag, and income higher than yours, not sure how you can go for a loan of 450k to 650k house...

just wondering, have u try talking to any loan officers?

This post has been edited by abu_adi: Apr 26 2010, 11:08 AM

Hi members, Would like to know for example if a person who has not settle previous personal loan debt will get rejected for his/her home loan app? But the reason to this is he/she taught that the loan has been settle but eventually there are few hundred bucks left. If payment has been made, will his/her record been cleared and result to successful loan app? Not to forgotten should he/she have a credit record such as credit card record? What will happen is there is none?
Please advise ,thanks.

bro, i think u can only think about buying a house after your probation period of the 4k salary job.

for your information i paid around 40k for 220k house. 40k for renovation, another 30k for the legal/misc fees, cheap furnitures and electrical equipment.

maybe u can afford <400k house max, if you dont have car installment/other debt on hand.

+1

think properly dude

i'm earning close to RM 3k, and can't afford a house at time being, looking at your situation, I guess I've failed financial planning.

better reconsider ur purchase...dun always plan ur salary for house installment only...later u got LOT of other comitment...wedding expenses, chrildren, car, parent bla bla bla...
i earn close to 8k p/mth and enough to cover my rm345k house...
juz share only la....

There's high-risk and there's calculated risk.
I urge you to practice the latter. On the basis on your current outlook, have you considered:
a. The legal fees, stamp duty etc into your calculation;
b. The cost of moving in, such as furniture, electrical appliances, renovation etc;
c. Stress testing the mortgage repayments, e.g. should BLR increase? (This is especially important since you are overstretching yourselves);
d. Beyond your 50k downpayment, do you have an emergency fund? What is the size of this emergency fund?
e. Do you have insurance?

If you are truly a high-risk taker (with no after thought), please play Lotto, invest in shares or even start a company!

Thanks for all the informative advices & advices guys....I will deffinitely give consideration on all your thoughts.....