Current Lowest Housing Loan Rates in Malaysia (2025)
| Bank / Product | Advertised Rate (p.a.) | Effective Lending Rate (ELR) | Notes |
|---|---|---|---|
| Maybank Islamic HouzKEY | 2.88% | ~3.10% | For first-time buyers, limited tenure |
| Bank Islam Baiti Financing | 3.80% | ~4.00% | Shariah-compliant home financing |
| Bank of China Mortgage | 3.88% | ~4.05% | Popular with longer tenures |
| HSBC Amanah HomeSmart-i | 3.98% | ~4.20% | Flexible repayment scheme |
💡 The advertised rate may look attractive, but the Effective Lending Rate (ELR) is what you actually pay once the bank adds its spread, fees, and other charges.
Understanding Fixed vs Variable Rates
- Fixed rates stay the same for a lock-in period (often 3–5 years).
- Variable rates move with the Standardised Base Rate (SBR), which follows OPR changes.
👉 To test different interest options, you can use this loan comparison calculator.
How Much Do You Really Save With Lower Rates?
Let’s compare two banks for a RM500,000 loan over 30 years:
- At 2.88% → Monthly = RM2,074, Total = RM746,640
- At 3.98% → Monthly = RM2,379, Total = RM856,440
That’s a difference of RM305/month or RM109,800 over 30 years.
👉 Before committing, check your eligibility with this loan affordability tool.
Beyond Rates: What Else to Consider
- Fees and charges: Legal, stamp duty, valuation.
- Lock-in period: Leaving too early may trigger penalties.
- Eligibility: Some packages are only for first-time buyers.
- Flexibility: Features like early repayment, redraw facilities.
For an estimate of transaction costs, try this legal fees calculator.
FAQs About Malaysian Housing Loan Rates in 2025
1. Which bank has the absolute lowest rate right now?
As of early 2025, Maybank Islamic HouzKEY leads with ~2.88%, but conditions apply.
2. Why is the Effective Lending Rate higher than the advertised rate?
Banks add a spread on top of the base rate, plus admin and processing fees.
3. Do Islamic financing packages always offer better rates?
Not always, but they often start lower and include flexible repayment terms.
4. How often do housing loan rates change?
They move whenever Bank Negara adjusts the OPR. In 2025, the OPR cut to 2.75% lowered many variable packages.
5. Should I choose fixed or variable in 2025?
Fixed gives stability, variable offers savings if OPR stays low. The choice depends on your risk tolerance.
Fredrick is the creator behind houseloancalculatormalaysia.online, dedicated to helping Malaysians easily understand and calculate their home loan payments. With a focus on accuracy and simplicity, Fredrick develops reliable tools and clear guides to empower users to make informed financial decisions. His goal is to provide trustworthy, user-friendly resources that save time and reduce confusion in the complex world of home loans.