Bella Leana

DON’T blame the bank if your loan application fails. The bank does not simply reject applications if there are no issues.

Here are a few tips to avoid prior to submitting our loan application.

BAD CCRIS

Having a bad Central Credit Reference Information System (CCRIS) record doesn’t necessarily mean that we have defaulted on our loan payment. It might also be because our existing loans have summon serve which is recorded in special attention account or probably the loan has been restructured or rescheduled. This will be seen as a weak scoring by the bank.

CARD CREDIT LIMIT USAGE

Some credit card holders might have exceeded the limit of usage. For instance, a card which is limited to RM10,000 and the user had used RM10,599 or probably just RM8,000. In short, if you have used up to 70 per cent out of the maximum limit of the credit card, the bank will regard you as “cashless”. Hence, there is little guarantee that you will be able to repay your loan.

MINIMAL AMOUNT OF SALARY ACCOUNT BALANCE

Usually your salary is credited into your bank account on the 25th of every month but by the 5th of the following month the remaining balance is just RM10.58. Worse still, you haven’t made any savings in any other funds like Tabung Haji or Amanah Saham Bumiputera.

TYPE OF PROPERTY YOU PLAN TO BUY

Purchasing a property is not like buying a dress where you can try it out and see it in front of a mirror, and then just pay for it. You cannot simply dispose of it or give it away to somebody else when you no longer like it. We must at least have a basic knowledge about the property that we want to buy. Whether it already has an individual title or the market value is acceptable or even if the location is a blacklisted area, etc. We have to really understand the surrounding area of the desired property.

WORK STATUS

It does not matter that you are working in an enterprise or a private limited, but what is most important is that you have the latest updated confirmation letter stating you are still serving your company. If you are under a contract and still haven’t been employed permanently after three years or may be because the company itself is having problems like failing to contribute to the Employees Provident Fund on time, these will all be deemed as unsafe for the bank to approve your loans.

INCOMPLETE DOCUMENT

Sometimes, the bank can be very particular with us in terms of the payslip that we submit for the loan application as they require an updated one. We might think that we can afford to serve our loan repayment for a RM300,000 property and our documents are sufficient, but in reality it is not easy to fork out RM1,500 from our pockets each month.

HIGH COMMITMENT

How would you survive if your monthly commitment is already 70 per cent out of your total salary and that does not include your cost of living yet. Unnecessary or “bad” debts will deter you from adding a new commitment for your mortgage.

WINDFALL FROM THE SKY

There has been a lot of cases where loan applicants try to deceive the bank by trying to hoodwink them like temporarily keeping a huge amount of money in the bank account. Of course the money doesn’t really belong to them but probably from their friends and family. The money will be kept until the loan application has been processed. This is intended to give a perception to the bank that the applicant has a lot in the savings account. Even if the money is from a recent land transaction the evidence must be attached to the loan application.

In conclusion, it is not that hard to convince the bank to approve a loan application if the things mentioned above can be avoided. Our financial profile and strength will determine if we can really be a good paymaster for our mortgage loans.

Bella Leana has nine years of banking experience personalising in financing profile and home financing application. She will be speaking on property and law at the New Straits Times Press (NSTP) MyRumah Property Showcase. The MyRumah Showcase, the first for this year, will have several property exhibitors and speakers. For more information, email myrumah@mediaprima.com.my or call Haslan at 012 6560263.

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