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.
- 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%.
- 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.
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.
- 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.
- 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%.
- 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! 🙂