Bank Negara urged to resolve loan issue of abandoned projects

The Malaysian Muslim Consumers Association (PPIM) called on Bank Negara to help solve the problems of house buyers who are facing bankruptcy due to abandoned housing projects.

It said the buyers are still forced to pay their home loans even when developers failed to complete the housing projects, and the financial institutions would demand repayment according to the sales price of the house they made with the buyer, and not at the vendor listed price.

PPIM financial services monitoring bureau chief, Sheikh Abdul Kareem Said Khadaied said it is unfair for banks to demand high repayment for a ‘non-existent’ product, adding that such a move violates the Islamic banking concept of Bai'Bithman Ajil (BBA).

According to the BBA concept, the sale of a property is done through the financial institution who will then sell the property to the buyer at a higher price than than the vendor listed price.

Thirty house buyers lodged a report at the Dang Wangi police station on Saturday after filing their complaint with PPIM.

Sheikh added that PPIM received hundreds of complaints relating to 42 abandoned housing projects around the country. He said PPIM has requested the Ministry of Finance to help resolve the issue.