How Much Home Loan Can You Get Based On Your Salary in Malaysia?

 

Buying a home is a significant financial decision, and knowing how much money you can borrow before you start shopping is essential. The amount of home loan you can get will depend on factors, including your salary, other debts, and credit score.

 

How much home loan can you get based on your salary?

As a general rule of thumb, you can borrow up to 30% of your gross income. It means earning RM5,000 per month could borrow up to RM150,000 for a home loan. However, it's important to note that this is just a general guideline. Your actual borrowing limit may be higher or lower depending on your other circumstances.

 

Other factors that affect your home loan eligibility

In addition to your salary, lenders will also consider other factors when determining how much money they will lend you, such as:

• Your debt-to-income ratio (DSR) is the percentage of your income that goes towards servicing your debts. A lower DSR makes you more attractive to lenders.
• Your credit score: A good credit score shows lenders that you are a responsible borrower and are likely to repay your loan on time.
• The type of property you are buying: Lenders may be more willing to lend you money for a residential property than a commercial one.
• The down payment you can make: A larger down payment will reduce the money you need to borrow and make you more attractive to lenders.

 

How to increase your chances of getting approved for a home loan

There are a few things you can do to increase your chances of getting approved for a home loan, such as:

• Improving your credit score
• Paying down your debt
• Getting pre-approved for a home loan
• Having a down payment saved up
• Getting a co-signer (if needed)

 

Tips for getting a reasonable home loan interest rate

The interest rate you pay on your home loan will significantly impact your monthly repayments. Here are a few tips for getting a good home loan interest rate:

• Shop around and compare different lenders
• Get pre-approved for a home loan from multiple lenders
• Negotiate with your lender

 

Common mistakes to avoid when applying for a home loan

There are a few common mistakes to avoid when applying for a home loan, such as:

• Not budgeting correctly for your monthly repayments
• Not understanding the terms and conditions of your loan
• Not getting pre-approved for a loan before you start shopping for a home
• Not having a down payment saved up

 

Conclusion

Buying a home is a big financial commitment, but it can also be an advantageous experience. Understanding how much home loan you can get and how to increase your chances of getting approved makes the process easier.

 

*Disclaimer

The information provided in this article is for general information only and does not constitute financial advice. You should always consult a financial advisor before deciding about your home loan.