Second Home Loan in Malaysia 2026: Eligibility and the 70% Margin Rule
Property Lab editorial teamPublished 11 min read
Key points
- In Malaysia, Bank Negara caps a new housing loan at 70% of the property value for anyone already holding two outstanding housing loans, a rule set on 3 November 2010.
- Under Bank Negara's 70% rule in Malaysia, each borrower on a joint housing loan is deemed to hold one outstanding account, and fully repaid loans drop out of the count.
- From 4 October 2026, Malaysian civil servants can take LPPSA second financing without settling the first, at a margin of up to 90% while the first is still running.
Contents
- Can you get a second home loan in Malaysia?
- What is the 70% margin rule for a third housing loan?
- How do joint home loans count towards the 70% rule?
- How do banks count your first loan in DSR?
- Worked example: RM600,000 home at 90% vs 70% margin
- What extra costs come with a second home?
- Can you use EPF for a second house?
- Can civil servants take LPPSA second financing?
- Developer deals: DIBS and the net price
- Tips to get a second home loan approved
- Second home loan checklist
- Frequently Asked Questions
- References
Yes, you can take a second home loan in Malaysia: Bank Negara Malaysia (BNM) leaves the margin on a borrower's first and second housing loans to each bank, and Hong Leong Bank's calculator, for one, assumes a loan of up to 90% of a home's value. The limit arrives with the third loan, because since 3 November 2010 anyone who already has two outstanding housing loans can borrow at most 70% of the property value.
A second home loan faces the same debt service ratio (DSR) test as a first, with your current instalment counted as debt. BNM caps third and later housing loans at 70% loan-to-value, counting outstanding loans, with each joint borrower deemed to hold one. On a RM600,000 home, the cash needed rises from RM74,700 at 90% to RM194,100 at 70% (illustrative).
Key numbers (as at October 2026)
- Third housing loan cap70%
- HLB margin, 1st and 2ndUp to 90%
- Company buyers cap60%
- Joint loan in HLB DSR50%
- LPPSA second financing90%
- MOT on RM600,000RM12,000
Also called: pinjaman perumahan kedua (second housing loan), Pembiayaan Kedua (LPPSA's second financing), margin pembiayaan (margin of financing), LTV (loan-to-value ratio), DSR (debt service ratio). Not MM2H (Malaysia My Second Home), a visa programme.
Can you get a second home loan in Malaysia?
In Malaysia, a borrower with one housing loan can apply for a second, and BNM sets no margin cap on it, so the loan size depends on the bank's credit policy, the valuation and your income.
When BNM introduced its LTV limit, its 3 November 2010 press release said financing for first and second homes was "not affected" and stayed at the level individual banks apply. The 90% often quoted online is therefore a bank choice, not a BNM rule.
What is the 70% margin rule for a third housing loan?
Under BNM's rule, a new housing loan to an individual who already holds two outstanding housing loan accounts is capped at 70% loan-to-value, so the third home and any later one need at least 30% down.
The detail is in BNM's Circular on Measures to Ensure Sustainability in the Residential Property Market (BNM/RH/CIR 013-5; we read a copy hosted outside BNM's site). It says:
- What counts: outstanding housing loan accounts with any lender, checked through CCRIS, so a fully repaid loan should drop out.
- Fourth loan onwards: for a borrower who already has three housing loans, banks set their own limit, never above 70%.
- What goes into the 70%: financed MRTA or MRTT premiums may be left out, but financed legal fees, valuation fees and stamp duty count.
- Abandoned projects: a bank may ignore a loan on an abandoned project.
- Companies: non-individuals buying homes are capped at 60%, however many loans they hold (from 9 December 2011).
| Loans already outstanding | Limit on the new loan |
|---|---|
| None or one | Bank's own policy |
| Two | 70% maximum |
| Three or more | Bank sets, up to 70% |
| Company buyer | 60% maximum |
Summary of BNM's 2010 press release and circular BNM/RH/CIR 013-5. We found no BNM notice withdrawing the 70% limit, and a PropCashflow guide updated March 2026 still treats it as current, but confirm with your bank before you book a unit.
How do joint home loans count towards the 70% rule?
For the 70% rule, every borrower on a joint housing loan in Malaysia is deemed to hold one outstanding account, so a loan you share with a spouse, parent or sibling uses up one of your two "free" loans.
Example: Aina has a sole loan on her flat and is a joint borrower on her parents' house, so she already holds two accounts and her next housing loan is capped at 70%. A 2016 Standard Chartered application form lets the bank cut financing to 70% for more than one outstanding housing loan "as a sole account holder or joint account holder". Our joint home loan guide covers the other risks.
How do banks count your first loan in DSR?
Malaysian banks add your existing housing loan instalment to your other debts and the new instalment, then divide the total by your net income; that debt service ratio must stay within the bank's own limit.
BNM's responsible financing guidelines (announced 18 November 2011) require banks to use income after tax and EPF and to consider all debt obligations. BNM sets no single DSR cap; CIMB calls 40% to 60% "good", and Hong Leong counts an existing joint housing loan at 50% of its instalment. Our home loan eligibility guide explains DSR in full.
| Monthly item (RM) | First loan sole | First loan joint |
|---|---|---|
| First home loan | 1,800 | 900 |
| Car loan | 700 | 700 |
| New RM540,000 loan | 2,489 | 2,489 |
| Total commitments | 4,989 | 4,089 |
| DSR on RM10,000 net | 49.9% | 40.9% |
Illustrative, computed in code: net income RM10,000 a month; the joint column counts the RM1,800 instalment at 50%, as Hong Leong does; the new instalment assumes 4.3% over 35 years, within the "from" rates on RinggitPlus in October 2026.
Worked example: RM600,000 home at 90% vs 70% margin
On a RM600,000 home in Malaysia, moving from a 90% loan to the 70% cap triples the down payment from RM60,000 to RM180,000 (illustrative).
| RM600,000 home (RM) | 90% margin | 70% cap |
|---|---|---|
| Loan amount | 540,000 | 420,000 |
| Down payment | 60,000 | 180,000 |
| MOT stamp duty | 12,000 | 12,000 |
| Loan agreement duty | 2,700 | 2,100 |
| Cash before legal fees | 74,700 | 194,100 |
| Monthly instalment | 2,489 | 1,936 |
Illustrative, our calculation. MOT duty with no exemption: 1% of RM100,000 plus 2% of RM400,000 plus 3% of RM100,000 = RM12,000 (LHDN Item 32(a)). Loan agreement duty is 0.5% of the loan; instalments use the same rate and term as the DSR table. Legal fees with 8% service tax are extra; our cost of buying a house guide lists them.
The 70% cap counts loans, not houses. Settling or selling one home before the next purchase can bring you back under two outstanding loans, while co-signing a relative's loan can push you over.
What extra costs come with a second home?
A second home in Malaysia pays full stamp duty, because the first-home exemption (homes up to RM500,000, SPAs signed by 31 December 2027) is only for Malaysian citizens who have never owned a house, alone or jointly.
- Stamp duty: 1% to 4% in bands on the memorandum of transfer, plus 0.5% on the loan agreement; our MOT guide shows the bands.
- RPGT when you sell: citizens and PRs pay 30% of the gain within three years, 20% in year 4, 15% in year 5 and nothing from year 6, LHDN says.
- One private residence exemption: it is once in a lifetime, so it can cover only one of your homes.
Can you use EPF for a second house?
KWSP lets members withdraw from Akaun Sejahtera to buy up to two homes, but if you used EPF for your first house, you must sell or dispose of it before withdrawing for the second.
You can take the lower of (price minus loan) plus 10% of the price, or your whole Akaun Sejahtera balance, if you are under 55 with at least RM500 in it. The reduce or redeem withdrawal covers a first or second house, not a third. We checked these rules on KWSP's live page on 26 October 2026; our EPF withdrawal guide has more.
Can civil servants take LPPSA second financing?
From 4 October 2026, LPPSA lets public servants apply for second financing (Pembiayaan Kedua) without first settling their first, with a margin of up to 90% while the first is unsettled and up to 100% once it is paid off.
The LPPSA notice of 25 September 2026 requires salary deductions for the first financing to have started and no arrears. Both financings share one limit of up to RM1 million, priced at 4.00% up to RM750,000 and 4.50% above; our LPPSA guide has the income bands.
Developer deals: DIBS and the net price
In November 2013, a BNM circular barred banks from financing purchases under the Developer Interest Bearing Scheme (DIBS) and required the loan-to-value ratio on all property financing to be worked out on the net selling price, The Borneo Post reported.
Net selling price is the SPA price minus all incentives, and the 2011 circular already required values net of developer discounts or rebates. So a rebate does not stretch a 70% loan: on a RM600,000 unit with a RM60,000 rebate, 70% of RM540,000 is RM378,000 (our calculation).
Tips to get a second home loan approved
Malaysian lenders judge a second loan on your credit record and spare income, so tidy both first.
- Check CCRIS: BNM's eCCRIS gives you your own report free; it shows 12 months of financing and repayment history.
- Clear small debts: paying off a car or personal loan lowers your DSR directly.
- Rental income: Hong Leong "may" accept a tenancy agreement or rental receipts as income proof, case by case; we found no bank page saying how much rent counts.
- Refinancing for cash: a top-up above the loan being refinanced counts as personal financing under BNM's new policy document, with a 10-year tenure limit from 1 January 2027; see our refinancing guide.
Second home loan checklist
- Count your outstanding housing loans, sole and joint, on your CCRIS report.
- Ask two or three banks for their margin in writing before paying a booking fee.
- Recalculate DSR with your current instalment and the new one at a higher rate.
- Budget full MOT and loan duty, legal fees and a larger deposit if the cap applies.
- Check whether EPF is still open to you, or whether the first house must be sold first.
- For a developer unit, work out the margin on the price after rebates.
Frequently Asked Questions
Can I get a second home loan while my first loan is still running?
Yes. The bank adds your current instalment to your commitments; BNM's cap starts only once two housing loans are outstanding.
Is the margin for a second house always 90% in Malaysia?
No. Up to 90% is common, but each bank decides, and a low valuation or high DSR can mean less.
Does a fully paid housing loan count towards the 70% limit?
It should not, since BNM counts outstanding accounts. Make sure the closed loan shows as settled on CCRIS before you apply.
I am a joint borrower on my parents' loan; does that count?
Yes. Each joint holder is deemed to have one account, so that loan plus one of your own puts your next loan under the 70% cap.
Can we get a second home loan through a company to avoid the cap?
Not on better terms: BNM caps housing loans to companies and other non-individuals at 60% from the first unit.
Can I use EPF Akaun Sejahtera for my second home's down payment?
Yes, if you did not use EPF for the first home, or have since sold it, up to your own Akaun Sejahtera balance.
Is there a stamp duty exemption for a second house?
No. The first-home relief needs a buyer who has never owned a house, so a second home pays duty on the transfer and the loan.
References
- Bank Negara Malaysia: Measures in Promoting a Stable and Sustainable Property Market and Sound Financial and Debt Management of Households (3 November 2010)Used for the 70% LTV on the third house financing and first and second homes being left to banks.
- Bank Negara Malaysia: Circular on Measures to Ensure Sustainability in the Residential Property Market, BNM/RH/CIR 013-5 (copy hosted by islamicbankers.center, PDF)Used for two outstanding accounts, CCRIS checks, joint accounts, the fourth loan, MRTA and fees in the LTV, net-of-discount values, abandoned projects and the 60% cap for non-individuals. We could not find this circular on bnm.gov.my.
- Bank Negara Malaysia: Measures to Promote Responsible Financing Practices (18 November 2011)Used for income after tax and EPF and counting all debt obligations.
- Bank Negara Malaysia: CCRISUsed for the free eCCRIS report and its 12 months of history.
- Hong Leong Bank: Home Loan (checked 26 October 2026)Used for the up to 90% residential margin, 50% of a joint loan instalment in commitments and rental documents as income proof.
- Standard Chartered Malaysia: Property Financing Application Form (V6.3, 2016, PDF)Used for the clause cutting financing to 70% for sole or joint housing loans.
- CIMB: Understanding DSR in MalaysiaUsed for the DSR formula and the 40% to 60% band.
- RinggitPlus: Home loan comparisonUsed to check the assumed 4.3% rate sits within advertised rates (October 2026).
- LPPSA: Penambahbaikan Kemudahan Pembiayaan Perumahan Sektor Awam, notice and FAQ (25 September 2026, PDF)Used for second financing from 4 October 2026, its conditions, the 90% and 100% margins, the RM1 million limit and blended rates.
- KWSP: Buy House Withdrawal (checked 26 October 2026)Used for the two-home rule, selling the first house, the amount and the age and balance conditions. Blocked to scripts on 26 October 2026.
- KWSP: Reduce or Redeem Housing Loan (read 20 October 2026)Used for first or second house only, not a third.
- LHDN: Garis Panduan Pengenaan Duti Setem, Jadual Pertama Akta Setem 1949 (30 June 2026, PDF)Used for the Item 32(a) MOT bands.
- Donovan & Ho: Incidental costs of purchasing a subsale propertyUsed for the 0.5% loan agreement duty.
- Skrine: Five stamp duty exemption orders extended (2 January 2026)Used for the first-home exemption to 31 December 2027.
- Low & Partners: FAQ on the stamp duty exemption orders (2021, PDF)Used for the never-owned test and the RM500,000 cap.
- LHDN: Real Property Gains Tax ratesUsed for the RPGT rates for citizens and PRs and the private residence exemption.
- The Borneo Post: Lending curb more stringent than expected (20 November 2013)Used for the DIBS ban and LTV on the net selling price.
- Bank Negara Malaysia: Policy Document on Personal Financing (30 September 2025)Used for the 10-year tenure rule taking effect on 1 January 2027.
- Skrine: Bank Negara Malaysia issues new policy document on personal financing (7 October 2025)Used for refinancing top-ups above the outstanding loan being treated as personal financing.
- PropCashflow: Loan margin of financing in Malaysia (updated 6 March 2026)Used only to show the 70% rule is still treated as current in 2026 (secondary source).
Bank policies change without notice, so check Bank Negara, your bank's product disclosure sheet, KWSP and LPPSA for the latest wording.
General information only, not legal, tax or financial advice. Ask your bank and a lawyer to confirm the margin, costs and eligibility for your own purchase.
Sources
- Measures in Promoting a Stable and Sustainable Property Market and Sound Financial and Debt Management of Households (3 Nov 2010) — Bank Negara Malaysia
- Circular on Measures to Ensure Sustainability in the Residential Property Market (BNM/RH/CIR 013-5, copy) — Bank Negara Malaysia (hosted by islamicbankers.center)
- Measures to Promote Responsible Financing Practices (18 Nov 2011) — Bank Negara Malaysia
- Penambahbaikan Kemudahan Pembiayaan Perumahan Sektor Awam (25 Sep 2026) — LPPSA
- Home Loan — Hong Leong Bank
- Buy House Withdrawal — KWSP (EPF)
General information only, not legal, tax or investment advice. Rules and rates change; check the official source linked below before you act.
Related news
MBSB Backs Sunway REIT For 2027 Despite 3Q26 Profit Dip
IOIPG Malaysia REIT IPO Offers 12.5% Upside At RM1.08 Fair Value Ahead Of Nov 25 Listing
Hektar REIT Cancels EGM For Proposed International School Acquisition
YNH Says Resolving Funding Priorities, After MARC Places RM170 Million Sukuk Rating Under Negative Watch
Related guides
MM2H and Buying Property in Malaysia 2026: Tiers, Rules and Costs
How to Check Property Value in Malaysia: Bank Value vs Market Value
Buying Subsale in Malaysia: 7 Common Mistakes to Avoid
Home Loans for Foreigners in Malaysia 2026: 5 Conditions Banks Check
How Foreigners Buy Property in Malaysia 2026: 7 Steps