Buying a house is a lot to wrap your head around — especially as a first-time home buyer. 

But if you know what to expect, it doesn’t have to be stressful or confusing. 

Do you know there is a lot of exemption benefit for first-time buyer?

This guide will help you figure out how much house you can afford and how to finance it, which are the first two steps to buying a home. 

Ready to get started?

First-time home buyers: Where to start

No one expects you to be an expert on the home buying process — especially when you’re a first-time home buyer.

But there are huge benefits to learning just a little.

The more you know, the better off and less stressed you’ll be. You may even get a better deal on your new home loan.

If you’re just getting started, there are a few key tips to keep in mind before diving in: 

1.       Get yourself a financial health check and credit score review before you submit a home loan application. Check whether you have missed any monthly repayment to any banks because these will actually affect your credit score. Learn about different types of home loans. 

2.       Understand your price range and monthly payment. Calculate your mortgage payment, including principal, interest, taxes, and insurance. Understand your mortgage rate as well as your budget. This will allow you to shop for a home and a mortgage with confidence.

3.       Save enough money for your down payment, the more you pay the higher the approval rate for a mortgage! (Cuz you borrow lesser). 

What is a mortgage? 

In Malaysia, everyone has to borrow at least some of the money to buy their new home. This is done with a special type of loan called a MORTGAGE.

So, what makes a mortgage different from other types of loans?

•  Low interest rate- an average of 3% annually among the banks
•  Extended repayment records- A maximum of 30+ years time to pay off their mortgage
• Interest rate and repayment- Bank interest rate and monthly repayment are fixed throughout the whole loan period. However, adjustable rate loan is available too.
• Loan is secure- Mortgages are secured by the value in your home; if you fail to make payments, bank can take back (“foreclose”) your house to recoup its losses.

Most people put some of their own money toward the purchase.

The amount paid out of pocket is known as the “down payment.” The mortgage covers what’s left over.

For example, if you bring RM40,000 of your own money to an RM400,000 home purchase, you have made a 10 percent down payment. The remaining amount — $360,000 — is covered by your mortgage.

How much down payment do I need for a house? 

A down payment is a mandatory lump sum payment made upfront for the purchase of property, whether it’s purchased from a developer or direct from a seller.

Buyers are required to pay a minimum 10% of the property's purchase price. That means if a house costs RM400,000, you will be required to pay at least RM40,000 upfront.

The remaining amount (90%) can be paid using a home loan or any other similar loan.

Buying Price of House - Loan Amount = Down Payment Amount
RM500,000 - (90% x RM400,000) = RM50,000

First-time home buyer Grants

As a Malaysian, you should know that our government offers financial incentives for first-time home buyer to get onto the property ladder for the first time.

Government projects like My First Home Scheme (Skim Rumah Pertamaku): allows first-time home buyers, aged 35 and below, to obtain 100% loan from financial institutions on properties valued between RM100,0000 and RM400,000.

Perumahan Rakyat 1 Malaysia (PR1MA): which aims to provide affordable housing to certain income-segments of the population.

To know more refer to these links:
Skim Rumah Pertamaku http://lphs.selangor.gov.my ,
Pr1ma https://www.bsn.com.my.

Please note that these government projects are affordable and only for first-time home buyers.

You should own one of these projects in your life.

Besides, that first-time buyers are now exempt from certain stamp duty charges confirmed in Budget 2021.  Full stamp duty exemption will be given to both instrument of transfer and loan agreement for the purchase of a first home worth not more than RM500,000.

You can save up to a maximum RM11,250 for that! And Two house is RM22,500!!