What is My First Home Scheme?

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Close your eyes and imagine your very first home.

Think about all the furniture you can buy, the little knick-knacks and souvenirs you can put on display, the friends you can invite over for dinners or parties…how exciting!

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Just like graduating, getting married, or becoming a parent, homeownership is a rite of passage that everyone aspires to achieve. It signals stability, independence, as well as a trophy of accomplishment. With your own home comes a sense of autonomy; you can do what you want with it without being at the mercy of the house owner.

As we all know, renting a home comes with a few rules dictated by the landlord. Maybe you have always wanted to build a gazebo in the front yard, but due to restrictions you have to bid your dream farewell and have your tea on the front porch instead. Or maybe you are an animal lover who longs to adopt a furry friend but alas, your landlord imposes a strict “No Animals Allowed” rule.

But with your own home, it is up to you to call the shots.

However, amidst current economic conditions, many of us are left scrambling just to make ends meet and ensure there is food on the table. Property prices continue to skyrocket disproportionately relative to household incomes, with no signs of slowing down. To stay afloat, most of us have to make do by renting, or staying with our families.

So what are the chances of turning this dream into a reality?

Do not fret, as the My First Home Scheme is here to give you a little help with securing appropriate financing to purchase a property!
In this article, we will be walking you through everything you need to know – including eligibility criteria, the participating banks from which you can obtain financing, and frequently asked questions – before you begin your first homeownership journey.


What is My First Home Scheme?

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The My First Home Scheme is an initiative put together by the government. It was first announced in the 2011 Budget by the Government of Malaysia. The objective of this initiative is to assist first-time home buyers who earn below RM5,000 per month individually, or below RM10,000 a month as a household, to purchase their first home.

With the My First Home Scheme, first-time homebuyers are allowed up to 110% financing from selected participating banks. This means that homebuyers are given sufficient funds upfront allowing them to avoid making down payments and thus lightening their burden.

This is a part of the Government’s mission to increase homeownership amongst the citizens of Malaysia. Cagamas, also known as the National Mortgage Corporation of Malaysia, plays a large role in the My First Home Scheme by providing a guarantee of up to 20% of the house value (i.e. banks will retain the risk of the loan up to 90% of the house value, with the remainder being guaranteed by Cagamas for financing amounts up to 110%) on a ‘first-loss’ basis.

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With the first-loss guarantee, Cagamas promises to pay a percentage of the loan amount if the borrower fails to pay.


Types of properties eligible under the My First Home Scheme

Mortgage, investment, real estate and property concept.

The types of properties eligible under this scheme are residential properties for own occupation, regardless of whether it is a fully-developed unit or is still under construction, from both the primary (new property) or secondary (resale property) markets.

Purchasing a property under the My First Home Scheme for other purposes such as running a business is not allowed and constitutes a breach in the conditions attached.

It is also important to note that there is an RM500,000 limit on the property value, and the property must be located in Malaysia. Once the property is purchased, the homeowner or homebuyer is not allowed to resell the property within five years of the purchase. The property purchased is not allowed to be rented out, as it is compulsory for the homeowner or the homebuyer to reside within the property to avoid exploitation and misuse of the My First Home Scheme.


Who can apply for the My First Home Scheme?

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In order to apply for the scheme, you must be a Malaysian citizen. Also, this needs to be your first house purchase in order to qualify as a first-time homebuyer.

In terms of your financials, it does not matter whether you are self-employed or are currently working under an organisation, as long as your income does not exceed RM5,000 (supported by official documents as proof). However, if you are employed by an organisation, you are required to be a confirmed staff of your employer for at least 6 months. You also need to ensure that you have no record of impaired financing within the past 12 months, as this will hinder you from being eligible for the My First Home Scheme. These impaired financing may include bankruptcy or payment arrears such as accumulated overdue payments.

Other financing requirements include a compulsory fire insurance, which can also be a takaful policy. To be eligible for the My First Home Scheme, your financing tenure cannot exceed 35 years, and that as an applicant, your age will not exceed 70 years at the end of the aforementioned financing tenure. Only amortising facility is allowed, with no redrawable features.

Regarding payment methods, you may opt between authorising a monthly salary deduction or setting up a standing instruction. Th is makes for convenient and easy transactions, where you will not have to go through the trouble of paying manually or risk forgetting to make your instalment payments.

Now let’s try out some calculations, shall we?

Assume you have landed yourself a job that pays RM3,000 a month after deductions, without annual increment or bonuses. After paying off your other commitments such as your car loan, electricity and phone bills, gym membership, perhaps Netflix or Hulu, and other personal expenses, you should be able to save about RM500 per month.

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After three years, you will have collected a savings amount totalling up to RM18,000. For this scenario, let’s imagine that your property is worth RM200,000.

Now, do you think that setting aside RM500 every month is a strain for your budget? And how do you think the value of the property that you’ve got your eye on will fare for the next few years? Is it worth it?


Participating Banks for Financing Under the My First Home Scheme

Now that we have the key details and requirements out of the way, let’s take a look at the participating banks you can visit to ease your home buying burden.

Currently, there are 24 participating banks for you to choose from:

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You can head over to the nearest branch of your preferred bank to apply for financing and be one step closer towards becoming a first time homeowner.

These participating financial institutions will be operating based on their individual underwriting and credit standards. It is advisable for you to carefully read through the specific terms and conditions of each participating bank before applying for a loan, so you are able to make an informed decision. Comparing the terms and conditions of different banks will help you decide on the best deal or contract that suits you.



Buying a home under the My First Home Scheme is a huge commitment and cannot be done on a whim; careful planning and consideration are important.

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To aid your decision-making process, here are some frequently asked questions that you can read through to give you some further information. In case you have a few nagging questions regarding the My First Home Scheme, you might just find the answers to your questions below!

Are applicants under the My First Home Scheme liable to the bank for only 90% of the financing amount, as there is a CSRP’s guarantee?

The answer is no. Applicants are liable to the bank for the full financing amount.

In order to enjoy financing up to 110% of the house value under the My First Home Scheme, is one subject to a higher interest or profit rate?

No, the normal interest or profit rate shall apply, in accordance to the respective banks.

If an applicant is currently working with a statutory or government organisation, while their spouse is currently working in the private sector, are they eligible as joint applicants under the My First Home Scheme?

The applicant does not need to worry about this issue, as long as their monthly household income does not exceed RM10,000.

How can an applicant qualify for a 100% financing in order to own a property worth RM400,000?

The applicant may apply through individual or joint applications. However, do note that the gross monthly household income of an individual applicant must not exceed RM5,000. On the other hand, the combined gross monthly household income for joint applicants must not exceed RM10,000.

If both applicants are under no financing obligations at the time of application, the financing tenure is 35 years. The monthly installment of the loan should not exceed 60% of the collective monthly net household income of the applicants involved.

If an applicant and their friend meet all the criteria, are they eligible for a joint application under the My First Home Scheme?

Unfortunately, joint applicants are only eligible among family members such as husband and wife, or siblings, provided that each applicant meets all of the criteria set.

Is an applicant still considered a first-time home buyer if they inherited a residential property?

No, because this does not contribute to the initiative towards assisting citizens in their quest to own their first home. Applicants may be required to sign a self-declaration form stating that they have not inherited, and currently do not own, a residential property prior to making the application.

If an applicant already has an existing loan that is used for the purchase of their first home, are they still eligible to refinance the loan under the My First Home Scheme?

Unfortunately not, as the Scheme does not include refinancing of an existing loan.

Are there any limitations regarding the type of residential properties or locations under the My First Home Scheme?

The type of residential properties and locations depends on the underwriting policies of the participating banks.

Does the My First Home Scheme include construction for properties under own land?

No, the scheme does not cover home construction.

Can legal fees be included under the My First Home Scheme financing?

The answer is subject to the respective participating banks’ discretion. Thus, the applicant will need to take careful consideration when choosing a participating bank.

In relation to the execution of Memorandum of Transfer, will there be any financial assistance to cover the cost under the My First Home Scheme?

This is also subject to the discretion of participating banks.


So, what do you think? Are you ready to begin the next chapter of your life? If you are not, it’s okay. Don’t rush into it.

Life is not a race, so keep calm and carry on.

We hope that this article has been informative and useful to you!

For further information, you may visit the My First Home Scheme website.

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