Malaysian property developers are now able to offer loans to their buyers.
Eligible developers can obtain licences and can then provide buyers with up to 100 percent of their home loans.
Local media reports quoted Urban Wellbeing, Housing and Local Government Minister, Tan Sri Noh Omar, as saying the licence will be issued by the Ministry under the Money Lenders Act 1951 (Amendment) 2011.
The reason behind the move is to enable developers to provide loans to buyers who are unable to obtain traditional bank financing.
He said: “This proposal is a win-win solution for both Malaysian property developers and house buyers,” in a keynote address at the recent National Housing and Property Summit.
Malaysian property developers are now able to profit from property sales as well as from financing.
Interest rates under the scheme will be a maximum of 12 percent with associated collateral, or 18 percent without such collateral.
Although the plan will assist developers in overcoming difficulties when closing deals, he added that companies would be screened and that only certain property projects would be approved for the scheme.
