BSN looks to ex­tend Youth Hous­ing Scheme

> Only RM400m of the RM6b funds al­lo­cated has been taken up by 1,600 bor­row­ers so far

The Sun (Malaysia) - - MEDIA & MARKETING - BY EVA YEONG

KUALA LUMPUR: Bank Sim­panan Na­sional (BSN) is look­ing to ex­tend the gov­ern­ment’s Youth Hous­ing Scheme (YHS) which of­fers 100% fi­nanc­ing for first time home­buy­ers, af­ter less than a tenth of the funds al­lo­cated have been taken up, more than 16 months into the scheme.

BSN, which is the sole bank ap­pointed for the RM6 bil­lion scheme launched in July 2015, has only ap­proved RM400 mil­lion worth of loans thus far, put in by 1,600 ap­pli­cants. Of this RM200 mil­lion have been dis­bursed.

Most of the loans are for prop­er­ties in the pri­mary mar­ket thus the loans are dis­bursed ac­cord­ing to pro­gres­sive pay­ments.

BSN deputy chief ex­ec­u­tive of re­tail bank­ing Fred­er­ick Siew said as of Oc­to­ber this year, the bank has re­ceived 4,000 sub­mis­sions with a to­tal value of RM1 bil­lion, of which 1,600 loans with a to­tal value of RM400 mil­lion were ap­proved.

“We’re giv­ing out 100% loan … so, we need to be very care­ful be­cause we have to be a re­spon­si­ble lender. We have to make sure that the buy­ers are credit wor­thy. It is risk-based. The risk for us is very much higher com­pared with a nor­mal hous­ing loan,” he told re­porters at the an­nounce­ment of a col­lab­o­ra­tion with de­vel­oper Ori­en­tal In­ter­est Bhd (OIB) yes­ter­day.

“When we first launched it that time, there was not much trac­tion, aware­ness was quite min­i­mal. It’s only when we started col­lab­o­rat­ing with de­vel­op­ers that peo­ple got to know about this,” he said. BSN has part­nered with 886 de­vel­op­ers to pro­mote YHS.

Ac­cord­ing to BSN se­nior vi­cepres­i­dent/head of dis­tri­bu­tion Akhsan Zaini, the ap­proval rate for YHS is in line with ap­proval rates for nor­mal hous­ing loans in the in­dus­try and this is due to the usual credit re­jec­tion rea­sons in­clud­ing bad credit stand­ing.

“My ad­vice to young mar­ried cou­ples, you need to man­age your fi­nances from the be­gin­ning, then you will be able to own a house. This is a 35year com­mit­ment,” he said.

“Of course, for black­list (cases) with other fi­nan­cial in­sti­tu­tions, we have cer­tain guide­lines on that,” he added.

Akhsan said the in­ter­est rates for loans un­der YHS fol­lows risk-based pric­ing, ac­cord­ing to cus­tomer credit stand­ing and can go as low as 4.65%. He said BSN will dis­cuss with the gov­ern­ment to hope­fully ex­tend the scheme beyond the two-year pe­riod.

An­nounced un­der Bud­get 2015, YHS is a part­ner­ship be­tween the gov­ern­ment, BSN, Caga­mas Bhd and the Em­ploy­ees Prov­i­dent Fund. It is tar­geted at mar­ried youths aged be­tween 25 and 40 with a com­bined house­hold in­come of no more than RM10,000 who are buy­ing their first home.

The scheme is limited to 20,000 ap­pli­cants or valid for two years, whichever comes first. Un­der YHS, BSN pro­vides home loans rang­ing from RM100,000 to RM500,000 with a ten­ure of up to 35 years or the age of 65, whichever is ear­lier.

Both con­ven­tional and Is­lamic home loans are avail­able, with fi­nanc­ing mar­gin of up to 100% of the pur­chase price and suc­cess­ful ap­pli­cants re­ceive ad­di­tional fi­nanc­ing of up to 5% of the pur­chase price for the cost of Mort­gage Re­duc­ing Term As­sur­ance or Mort­gage Re­duc­ing Term Taka­ful.

In ad­di­tion, suc­cess­ful ap­pli­cants also get monthly dis­burse­ments of RM200 from the gov­ern­ment for the first two years from the first dis­burse­ment.

From left: OIB Group COO (mar­ket­ing di­vi­sion) Beh Suan Sim, chair­man Datuk Wira Lim Teong Kiat, Siew and Akhsan dur­ing Seroja Hills Phase 2 of­fi­cial launch and OIB's part­ner­ship with BSN Youth Hous­ing Scheme.

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