Housing loan rules eased for civil servants
KUALA LUMPUR: Government employees who apply for housing loans under the Public Sector Housing Financing Board will be allowed flexibility in repayments instead of having to be constrained by the condition that their take-home pay must be at least 40 per cent of their monthly salary.
Chief Secretary to the Government Tan Sri Dr Ali Hamsa said the government saw housing as a basic need and that there should be flexibility in loan applications.
He said the existing circular provided for a maximum deduction of up to 60 per cent of the monthly salary of government employees, with their take-home pay making up the remaining 40 per cent.
“But, in this case, we are providing housing to civil servants, through PPA1M (1Malaysia Civil Servants Housing Project), so we have asked the unit in charge of loans for civil servants under the Treasury, to be more flexible.
“When civil servants reach the 60 per cent (maximum deduction) level, they can’t borrow money for housing.
“So, we said for housing, they should be given an exemption,” he said after receiving the new World Bank report on “Enhancing Public Sector Performance: Malaysia’s Experience with Transforming Land Administration” here yesterday.
The circular on the flexibility was shared on Ali’s Facebook page on Tuesday.
Asked whether the move would bloat applicants’ debt, Ali said housing and other household debts should not be put under the same category.
“In this case, we feel that housing is a priority for civil servants.
“We would like to see every civil servant own a house. We don’t want the loan to be an obstacle.
“This is to encourage civil servants to own home.” Bernama