The rejection rate of housing applications has declined to below the average rate of about a quarter of all cases, said Bank Negara Malaysia (BNM) in its “Financial Stability and Payment Systems Report 2017”.
The report stated that the rejection rate of housing applications currently stands at 23.1%, below the 2012-2016 average of 26.1%.
Among the reasons cited for the housing loan rejection include insufficient income to support debt repayment, adverse credit history, and inadequate income or financial documentation.
“The improvement reflects the greater alignment between bank lending standards and borrowing behaviour in line with the Policy Document on Responsible Financing,” said the report.
Meanwhile, banks continue to provide home financing to first-time homebuyers despite the soft property market.