Reduce Maximum Loan-To-value Ratio to 70% for Residential Property

Breaking news for property financing in 2010 had been announced. Bank Negara quote “ with immediate effect the implementation of a maximum loan-to-value (LTV) ratio of 70%, which will be applicable to the third house financing facility taken out by a borrower.”


According to Bank Negara statistics, outstanding loans growth for the banking sector grew 11.9% to RM841.74bil in July year-on-year. Mortgages make up the largest portion with some 26.8% of the total loans outstanding as at end July.


The move is aimed at curbing speculative property transactions in a bid to contain escalating property prices. 

For those who buying the 1st and 2nd property still valid for 90% loan financing, 70% loan financing effect for 3rd property home buyers. However, for property investors, may think twice about investing in properties if they have to cough up more money.