Effective from 1 Jan 2012 Bank Negara Malaysia had started a new guideline on home loan application whereby previous calculation on Net Income are change to as follow:

 

Net Income Old FormulaNet Income = Gross Income – Other Debt (personal loan, business loan, car loan, credit card and etc) New FormulaNet Income = Gross Income – Tax – EPF deduction (if any) – SOCSO – Other Debts

So for example:

Example A:

If Borrower X have a gross income of RM4K/month and do not own any debts and he wish to borrow RM300,00.00 with 4.5% interest with 30 years term. Can he eligible on that?

  1. Gross Income = RM4,000.00
  2. EPF 11%= RM440.00
  3. SOCSO = RM14.75
  4. Net Income = RM4,000 – RM440 – RM 14.75 = RM3,530.50
  5. Repayment = RM1,520 (For RM300K loan)
  6. Dept Income Ratio = 45%
  7. Maximum Repayment per month = RM3,530.50 x 45% = RM1,588.73
  8. Maximum Borrower X can be finance = RM313,552.00

So, for above example, Borrower X are eligible to apply RM300k loan.

 

Example B:

If Borrower Y have a gross income of RM4K/month and have a car loan of RM500 per month and he wish to borrow RM300,00.00 with 4.5% interest with 30 years term. Can he eligible on that?

  1. Gross Income = RM4,000.00
  2. EPF 11%= RM440.00
  3. SOCSO = RM14.75
  4. Net Income = RM4,000 – RM440 – RM 14.75 – RM500 = RM3,030.50
  5. Repayment = RM1,520 (For RM300K loan)
  6. Dept Income Ratio = 45%
  7. Maximum Repayment per month = RM3,030.50 x 45% = RM1,363.73
  8. Maximum Borrower X can be finance = RM269,146.00

So, for above example, Borrower Y are not  eligible to apply RM300k loan.

 

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