Commercial Loan


Commercial Loan


Commercial loan is another type of building financing.

Commercial includes shop lot, commercial area building, SOHO, SOFO, SOVO, Shop lot etc, which don’t have Housing development act. If a building has Housing development act, it will be considered as a residential property.

  1. What’s the different financing between commercial loan and residential loan?

Residential loan financing max financing is 35 years and margin of financing is 90%. Whereby commercial loan max loan tenure 25-30 years (depends on the bank’s promotion) and max margin of financing for commercial loan is fixed at 85%.


  1. If I get 4th commercial loan in CCRIS, will my margin of finance drop to 70%?

For residential loan, if you currently have 2 housing loan and in the process of acquiring 3rd housing loan, bank will only finance max 70% margin of finance. But for commercial loan, it will always remain 85% margin of finance irrelevant to the number of housing/commercial loan you have.


  1. GST

There’s a 6% cost incurred when purchasing commercial property. Hence it will add on to your overall cost for property purchase/ investment. Lets say you are purchasing RM1mil property, you will need to pay additional 6% (1,000,000 * 0.06 = RM60,000). For residential , there is no gst charges for purchasing of residential property.


  1. Commercial property such as soho,sovo,sofo without housing development act, can I stay in it?

In actual fact, property without HAD, is deem not safe to stay and sleep in like a normal residential house. Law stated it’s illegal to stay in such property as a home. However, in Malaysia, Malaysia “boleh” (can), hence it’s still allowed illegally. But with own risk.


  1. Interest rate

Interest rate are much higher for commercial loan compare to residential loan. Normal RM500K residential loan interest rate will range between 4.3-4.5%. However, for commercial loan RM500,000, interest rate range 4.5-4.75%.


  1. Can I still finance legal fees into my commercial loan?

Yes, certain banks allows you to finance legal fees into your commercial loan, just like residential loan. Max 5%. However depends on different bank guideline.






Everything whole constant, just slight different at above Q&A.

Anymore inquiries, just leave comment at below section! 🙂


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