Harder for B40 group to get housing loan with bad record: Expert

PETALING JAYA: It is difficult for those in the B40 group to get a housing loan due to their low income. However, having a good credit rating will help in securing financing for a house.

Credit Counselling and Debt Management Agency (AKPK) financial education trainer Dr Desmond Chong highlighted the importance of having a good credit history and cashflow for those seeking housing loans.

He advised them to make prompt payments of bills, especially credit card and car loans.

“If a person has a bad payment record, paying bills late, it will affect their credit rating, making it harder for them to get a loan.

“People should take a productive loan, like a loan to buy a house, and not a consumption loan, personal loan to go on holidays or spend on other things,” he told theSun.

Chong said banks usually give out a loan that is 65% of a person’s income. If for example, a person gets RM3,000 a month, the person is entitled to a loan with a monthly repayment of RM1,950.

“While it may be easier for the M40 group to get a loan, it is harder for the B40 group,” he said.

However, low-income families who do not qualify for a housing loan may have an alternative.

TRB Ventures Sdn Bhd chief executive officer Quek Wee Siong said the B40 and M40 group would be able to purchase a house via a Rent-To-Own (RTO) scheme.

He said the families will be able to rent a house for a three to five-year period before they can purchase the home.

“The RTO scheme will allow them to get their finances in order so they will be able to qualify for a loan,” Quek told theSun.

He said if they were still unable to do so, they can continue the scheme for another three to five years. They also have the option of selling the home.

Bank Negara had announced that 26.5% of those applying for housing loans fail to get one.

He said the monthly payment scheme would be lower than a bank loan installment.

“Under the scheme, the payments they make will form part of the down-payment.”

Quek said discussions with about 60 housing developers to join the scheme are ongoing.