{"id":17541,"date":"2021-02-21T19:00:00","date_gmt":"2021-02-21T11:00:00","guid":{"rendered":"https:\/\/www.comparehero.my\/blog\/uncategorized\/down-payment.html"},"modified":"2026-03-26T16:01:59","modified_gmt":"2026-03-26T08:01:59","slug":"down-payment","status":"publish","type":"post","link":"https:\/\/www.comparehero.my\/blog\/properties\/down-payment.html","title":{"rendered":"#PropertyHacks – Here’s Everything You Need To Know About Down Payments"},"content":{"rendered":"\n

Even if you don\u2019t plan to buy a house in the next couple of years, it wouldn\u2019t be a bad idea to start thinking about saving for a down payment.<\/p>\n\n

After all, most people will want to own a house<\/a> at some point\u2014and unlike saving for retirement, where the funds would be untouched for years, the time horizon for a down payment fund is much shorter. If you are 20-years-old this year, you will likely need at least 10 years (or shorter) to build up a solid down payment fund. It really depends on your stage of life.<\/p>\n

Plus, being able to commit to a big down payment is a dream\u2014and privilege in a sense\u2014 as it can save you a lot of money in the long run because the higher your down payment, the lesser your monthly payment amount and total home loan repayment<\/a>.<\/p>\n

Don\u2019t take down payments lightly because, as a buyer, it will affect the home loan amount that you’re eligible to borrow and pay back over a stipulated period of time.<\/p>\n

Here\u2019s our handy 101 guide on down payments to help you navigate this complicated financial maze.<\/p>\n

[toc]<\/p>\n

Related:<\/strong> #PropertyHacks: Buying Your First Home In Malaysia \u2013 The Pre-purchase Stage (Part 1)<\/a><\/p>\n

\"house-down-payment-in-malaysia-1\"
In Malaysia, a down payment is generally 10% of the property purchase price. <\/em><\/p>\n

What is a down payment on a house?<\/h2>\n

A down payment is a mandatory, lump sum initial payment made to secure a property<\/a> from a developer or from a seller. It is typically 10% of the property\u2019s purchase price.<\/p>\n

Similar to a deposit, it is made-out-of-pocket, and is followed by a financial arrangement that will satisfy the rest of the debt. However, don\u2019t confuse a down payment with an earnest deposit!<\/p>\n

Earnest deposit vs down payment – what\u2019s the difference?<\/h2>\n

An earnest deposit is a deposit that you pay to the seller or property agent to book a house. It\u2019s your way of demonstrating your interest in a property.<\/p>\n

Often described as an initial deposit, it takes up 2% of the total 10% down payment.<\/p>\n

What is the usual down payment rate for a house in Malaysia?<\/h2>\n

Though you won\u2019t be able to pay less than 10%, paying a higher down payment helps reduce your monthly payment amount and total home loan repayment. So the higher your down payment, the better!<\/p>\n

Think of it this way: the higher the initial money you put in for a house, the less debt you need to take up over the course of your loan. <\/strong><\/p>\n

Most banks will typically offer home loans of up to 90% of the property\u2019s price for a buyer\u2019s first two residential properties. So if your house costs RM300,000, you need to pay at least RM30,000 upfront.<\/p>\n

Here\u2019s the formula:
<\/strong>Price of house – loan amount = down payment amount<\/p>\n

RM300,000 – (90% x RM300,000) = RM30,000<\/p>\n

Related:<\/strong> #PropertyHacks: Buying Your First Home In Malaysia? Here\u2019s What You Need To Know \u2013 The Buying Stage (Part 2)<\/a><\/p>\n

\"house-down-payment-in-malaysia-2\"
We all need a little assistance from time to time, the Malaysian government has established a few schemes to help first-time buyers own a house.<\/em><\/p>\n

Are there any schemes for down payment assistance?<\/h2>\n

For many of us, saving up for a down payment is the biggest hurdle to being a homeowner, especially for first-time buyers who have not been able to build significant savings. And we haven\u2019t even factored in<\/a> rising inflation rates and cost of living.<\/p>\n

Besides amping up your saving efforts and being more prudent, home-seekers can also leverage homeownership assistance schemes<\/a> that either provide assistance specifically for the down payment or other facets of home ownership.<\/p>\n

1. MyDeposit or First Home Deposit Scheme<\/strong><\/p>\n

Launched by former Malaysian Prime Minister Datuk Seri Najib Razak, this scheme aims to aid middle-income Malaysians in purchasing their first homes by providing a one-off contribution to down payments amounting to 10% of purchase price, but at a maximum payment of RM30,000.<\/p>\n

Simultaneously, it provides incentives for developers to create more affordable homes. A total of RM200 million was allocated for the scheme, and has benefited an estimated 6,666 applicants.<\/p>\n

Application is now but closed, but be on the lookout if it opens up again soon.<\/p>\n

Eligibility and requirements:<\/strong><\/p>\n