First-time home buyer loans: How to check your eligibility before applying

Why Eligibility Matters for First-Time Buyers

Buying your first home is exciting, but it also comes with paperwork and strict bank requirements. Before you start house-hunting, it’s smart to know if you actually qualify for a loan. Home loan eligibility shows how much you can borrow based on income, debt, and credit history.

If you check this early, you’ll avoid rejection, know your budget range, and save time when applying.

👉 You can start with a quick check using our home loan eligibility tool.

Key Factors Banks Look At

1. Income and Job Stability

Banks want to see a steady income. Generally, they prefer if your monthly instalments don’t exceed 30–40% of your salary.

2. Debt-to-Income Ratio (DSR)

Your Debt Service Ratio compares debts to income. A lower DSR means better chances of approval.

👉 Try the DSR calculator for Malaysia borrowers to see how banks view your profile.

3. Credit History

Banks check CCRIS/CTOS reports. A good repayment record helps; too many missed payments reduce eligibility.

4. Down Payment & Loan-to-Value Ratio

Most first-time buyers get up to 90% financing. You’ll need at least 10% upfront, plus extra for legal and stamp duty fees.

5. Property Details

The location, type, and valuation of the home also influence approval.

Don’t Forget Extra Costs

First-time buyers often forget about fees beyond the monthly instalment. Key expenses include:

• Stamp duty & legal fees (can be estimated with a stamp duty calculator)
• Mortgage insurance (MRTA/MLTA)
• Property tax and maintenance charges

Steps to Check Your Eligibility

1. Estimate your borrowing capacity – Use a home loan calculator.
2. Check your DSR – Ensure it’s within the bank’s safe range.
3. Review your credit score – Clear overdue debts if possible.
4. Budget for extra fees – Stamp duty, insurance, and taxes.
5. Compare banks – Use a loan comparison calculator to see repayment differences.

Example Scenario

Let’s say your income is RM5,000, with RM1,200 in debts. That gives a DSR of 24%—very healthy. You could qualify for about RM400,000 in financing.

But if you add another RM800 loan, your DSR rises to 40%. That lowers the amount you can borrow by more than RM100,000.

How to Improve Eligibility

• Pay off smaller loans before applying.
• Save more for down payment.
• Apply jointly with a spouse to increase combined income.
• Avoid new credit cards or loans just before your application.

Final Thoughts

Checking your home loan eligibility before applying is not just about getting approved—it’s about protecting your finances long-term. With the right tools, you can calculate your borrowing power, plan for extra costs, and compare bank offers with confidence.

💡 Start now with the Malaysia Home Loan Eligibility Calculator and take your first step toward homeownership.