FOR many people, owning a home is a lifelong goal.

However, obtaining a mortgage is difficult for those with variable or low-wage incomes.

Other causes for a rejected home loan include failing to fulfill the required criteria, submitting incorrect or insufficient paperwork and poor credit history.

With these issues in mind, the government established Syarikat Jaminan Kredit Perumahan Berhad (SJKP) in 2007 to guarantee the financing provided by participating financial institutions to first-time homebuyers.

This programme was created to help first-time homeowners and individuals who don't have a steady income, such as gig and freelance employees, independent business owners, small traders and entrepreneurs.

HOME FINANCING OF UP TO RM400,000

The government announced an additional RM2 billion guarantee for the SJKP scheme in Budget 2022 for first-time homebuyers on October 29, 2021.

Those who qualify for this programme can obtain up to RM400,000 in home financing from participating banks, which will include the principal loan amount, Mortgage Reducing Term Takaful (MRTT)/ Mortgage Reducing Term Assurance (MRTA), Long Term House Owner's Takaful (LTHO), solicitor's fee and valuation fee.

Agrobank, Bank Islam, Bank Muamalat, Bank Rakyat, Bank Simpanan Nasional and RHB Bank are the six major participating banks in the project. Other financial institutions participating in the programme are listed https://www.sjkp.com.my/en/fi-partners

Applicants' eligibility standards are substantially more lenient with SJKP.

The following are the criteria for this scheme:

1. Malaysian citizens aged 18 years and above. (Two-generation financing is allowed.)

2. Purchase of first new residential house or existing house (sub-sale) or auctioned house which is under low or medium or affordable category and to be owner-occupied.

3.The total repayment of all applicant's loans does not exceed 65 per cent of gross monthly income.

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

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

In terms of interest, it is calculated using the financial institution's base rate for the financing/loan.

Applicants must also have a deposit equal to three months' monthly instalment, as determined by their chosen financial institution.

The SJKP scheme benefits those with stagnating or no stable incomes, as well as those who lack payslips and are self-employed.

Malaysians working in the gig economy, small enterprises, online businesses, e-hailing and other fields can now buy their first home for up to RM400,000 with a 35-year finance term.

Interestingly enough, the scheme allows two-generation financing, whereby they can apply for an extension for the repayment period. 

For more information, please visit SJKP's website https://www.sjkp.com.my/en/
*Terms and conditions apply.