Avoid home loan rejection with PropertyGuru’s fintech solution

  • Home loan rejection rates stood at nearly 60% by value last year
  • Matches users to property; panel of three banks offers preferential rate via platform

(From left) PropertyGuru product director (consumer) technology Vivek Kumar; CMO & head of Fintech Bjorn Sprengers and country manager Sheldon Fernandez.

PROPERTY marketplace PropertyGuru launched its ‘PropertyGuru Home Loan Pre-Approval’, to help Malaysians avoid home loan rejection by applying for the right loan amount. Despite 92% of Malaysians expressing their interest in purchasing properties according to research by PropertyGuru, loan rejection rates remain high.

Home loan rejection rates stood at nearly 60% by value last year according to Bank Negara Malaysia. This affects many Malaysians’ property aspirations. It also impacts developers and real estate agents across the board, with an estimated 43,219 residential units worth RM29 billion unsold nationwide as of 3Q18.

In the same quarter, four out of five of the country’s top developers by capitalisation posted lower year-on-year earnings. These ranged from marginal decreases to 93.17% declines. In addition, transaction volumes were reported at 311,824 in 2017 according to the Malaysian Institute of Estate Agents, down from 430,400 in 2011.

PropertyGuru Malaysia country manager Sheldon Fernandez, shared the rationale behind this new tool. “The odds are against us. In Malaysia, there is a higher chance of getting rejected than approved. The main reason behind this is the lack of knowledge on how much the bank will loan. Ultimately, it comes down to awareness,” he explained.

Upon registering with name, identification card (IC) number and a photograph of IC back and front on the PropertyGuru Malaysia website, users can key in their income while their credit score and rating is extracted from Credit Bureau Malaysia.

“We take data security very seriously by holding ourselves to the highest security encryption standards, especially since we are partnering with banks and Credit Bureau Malaysia,” assures Vivek Kumar, the director of consumer product technology at PropertyGuru Malaysia.

Once users’ credit history and financial health is benchmarked against Bank Negara Malaysia’s eCentral Credit Reference Information System (eCCRIS), the debt service ratio (DSR) is then calculated within five minutes at 99.9% accuracy as claimed by PropertyGuru.

Beyond that, the user’s qualified loan amount is matched to properties on the site for them to choose from. Together with its banking partners RHB Bank, Alliance Bank and Hong Leong Bank, users can then select the property they like and apply directly to these banks and enjoy a preferential rate.

 
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