Cabinet wants home financing policy to be reviewed and improved

The Cabinet today instructed the Ministry of Urban Wellbeing, Housing and Local Government to review and improve the home financing policy stated under the Moneylenders Act 1951 for house purchase.

Minister Tan Sri Noh Omar said matters concerning the effectiveness of the policy in helping the people in securing loans for house purchase was discussed and concluded after he explained his housing developer loan facility proposal to the Cabinet members during their meeting today.

This is because the policy exists and several companies have been given the money-lending licence to give out bridging loans as deposit for house purchase, he said in a statement today.

Noh said the Cabinet also called for a review and improvement of the policy, in terms of interest rates and repayment period, so that it would not burden the people, besides to have a clear guideline which would be easily understood by both licensed moneylenders and borrowers.

"At the same time, the ministry will also take proactive measure and look comprehensively into the effectiveness of the loan facilities under the Moneylenders Act 1951 (Amendment) 2011 (Act 400) to ensure that it is not being misused by irresponsible licence holders," he said.

Last week, Noh proposed an initiative to allow housing developers to offer home loans as there was a provision under the Moneylenders Act 1951 to help house buyers who face difficulty in securing full bank loans.

Noh said the proposal, however, received a mixed reaction from various quarters, as well as speculations on the details of the proposed scheme.

"I would like to clarify that the proposal involves financing scheme as stated under the Moneylenders Act 1951 (Amendment) 2011 (Act 400), which is under the jurisdiction of my ministry," he added. -- BERNAMA