Mortgage Planning

1) Property Type and Location

Check your mortgaged property whether is fall into Lenders' NON NEGATIVE LISTING properties or not. Every Lender has their own listing and it is different from each other.

Property value MUST be justifiable by Bank's panel valuer firms. You might want to get verbal indication on property value from Lenders up front. It is FREE! To get property current market value, kindly provide the property details as below:

a) Property Full Address
b) Type of property
c) Freehold/ Leasehold (balance years to go)
d) Size (land & build up)
e) Title, if any
f) Renovation details, cost involved and when was the renovation?

2) Borrower Income and Job Stability

How to prove your income? (Employee)

a) IC for all applicants
b) Latest 3 months payslips
c) Salary credited bank statement (print out from bank counter & get bank’s endorsement if passbook did not show salary credited transaction)
d) Latest EPF statement
e) Latest EA Form
f) Borang BE with tax receipt / bank-in slip
g) Vendor’s previous Sales & Purchase Agreement (S&P) (for sub sales / 2nd hand)
h) House’s copy of title (if any)
i) Booking receipt (for new property)
How to prove your income? (Business Owner)

a) Copy of IC
b) Business Registration Form
c) Borang B with tax receipt / bank-in slip
d) Latest 6 months company bank statements
e) Vendor’s previous Sales & Purchase Agreement (S&P) (for sub sales / 2nd hand)
f) House’s copy of title (if any)
g) Booking receipt (for new property)

3) Mortgage Debt Service Ratio (Mortgage Repayment per month/ Income per month)

Make sure your Debt Service Ratio is not exceed 1/3 or 33.33%! Or you will be falling into category of difficult in repay-back the installment and possibility of bad debts from Lenders perspective.

If out of the ratio, then
a) Source for co borrower in bring up the Income as a whole.
b) Lower down the loan amount to be borrowed.

4) Total Debt Service Ratio (Total Debts Commitment per month / Income per month)

Make sure your Total Debt Service Ratio is within 80%. Total Debt Service Ratio should be within 50% is the best, or you are highly exposed to debts! This is not "healthy" in Finance!

Total Debts Commitment includes other mortgage loan, personal loan, overdraft, credit card minimum payment, hire purchase loan and others.

5) Your Repayment Habit/ Pattern

Lenders are accessible to Central Credit Reference Information System (CCRIS) to find out borrower repayment pattern. CCRIS is a computerized database system that stores information reported to the Credit Bureau on individuals’ repayment pattern of all debts commitment under Financial Institutions. Lenders will judge the repayment pattern in granting the new loan facility to you.

6) Your Credit Background

Lenders are accessible to Credit Tips off Service (CTOS) to find out borrower credit background such as any bankruptcy or court case pending.