Step by Step Guide to Housing Loan Application

18th, April 2023

Applying housing loan from banks can be a daunting process, especially for first timers. But planning ahead and preparing beforehand will help in making the process smooth and hassle free. Also, if you are purchasing from UDA Property, our sales team will help and guide you on the below process attentively! 

In order to apply your loan, here’s a list of documents that you will need to prepare:

  • Booking form from your property agent/developer
  • IC / passport
  • Payslip
  • 12 months of bank account statements
  • Income tax receipt
  • 6 months EPF statement
  • Proof/statement of other income (if any) such as unit trust, ASB, fixed deposit & etc.

Approximately, if all of the documents are provided properly and according to the requirement of the banks, it will take around 2 to 3 business days to get a verbal answer from the banker if your loan may proceed to the next approval stage. Even though all of the above documents have been verified by the bank, the bank will still need further confirmation on your financial state from government financial agencies before they can proceed with the loan.

Related government agencies in this matter would be:  

  • Central Credit Reference Information System (CCRIS)
  • Income Tax Department (LHDN)
  • Employees Provident Fund (EPF)

Upon receiving confirmation and “greenlight” from all three parties, the bank will then proceed with the loan approval. There will be delays if the income and expenditure of the individual applying for the loan is not breaking even or cannot support the amount of loan repayment for the property.

On top of that, there are two main collateral documents that will be required from the purchaser.

The first collateral document would be Letter of Undertaking, which would be provided by the seller. The Letter of Undertaking will be drawn up by the lawyer acting for the seller, and the terms will encompass:

  • Completion of the property.
  • A Certificate of Compliance and Completion (CCC), which provides final sign-off on the construction of a building.
  • Consent of Transfer, which is an official statement stating a transfer of property ownership, if the property requires it.
  • Execution of the Memorandum of Transfer (MOT), another type of legal document that declares for an official transfer of property ownership, for properties with title.
  • Money disbursed by bank for the mortgage loan to be refunded if for any reason the property cannot be transferred to the purchaser.

The second collateral document required by the bank is the Statutory Declaration. This document has to be signed for the acting bank to carry out the necessary checks on the purchaser. This document will be signed in front of the Commissioner for Oath or the Notary Public. The document will be authenticated with the official rubber stamp of the name and number of the Commissioner of Oath.

In essence, in order to apply a house loan, you will need to ensure you prepare the right document and that your finances are in a good condition. And even once your loan is fully approved, there will still be other aspects to tackle when it comes to purchasing a property. 

Sounds daunting? Fret now, at UDA Property we will be there to guide you every step of the way with your loan application. Call us at +6011 1722 5558 to inquire on how we can help you with your loan application process! 

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