non-residents can obtain mortgage financing from Malaysian and some foreign banks using Malaysian property as collateral. Malaysia is one of the few countries in the region that allows foreigners to own strata and selected landed properties under their own name (subject to state minimum price and restrictions).
Financing KLCC & KL City Centre Properties as a Foreigner”.
However, compared with Malaysians, foreigners generally:
• Get a lower margin of financing (loan-to-value ratio)
• Face stricter income and documentation checks
• May be limited to selected banks and selected products (e.g. MM2H packages)
Key rules for non-resident borrowing (Bank Negara perspective)
Bank Negara Malaysia (BNM) regulates borrowing by non-residents mainly to maintain financial stability and manage foreign exchange flows. For individual foreign buyers purchasing a residential property in Malaysia:
• You may borrow in ringgit (MYR) from onshore banks to finance property in Malaysia, subject to the bank’s own credit policies.
• There is no blanket prohibition on non-resident housing loans, but banks must assess your repayment ability based on foreign income and existing debts.
• Cross‑border transfers (bringing money in and repatriating sale proceeds later) must comply with BNM foreign exchange rules and any applicable reporting.
In practical terms, this means:
• It is possible to finance your KL city centre property with a Malaysian loan.
• The “real gatekeeper” is the bank’s internal credit policy, not just BNM.
How much can a foreigner borrow? (LTV & margin of finance)
For Malaysians buying their first and second homes, banks may go up to 90% LTV, subject to income and credit checks. For foreigners, the typical range is lower:
• Foreigners without a long‑stay visa (no MM2H, no work visa): around 50–60% of the property price.
• Foreigners holding MM2H or a valid work visa: around 60–70% of the property value.
Some banks may offer more generous terms to strong profiles (high income, strong assets, private banking client), but you should plan conservatively around these LTV ranges.
Important notes:
• The LTV policy that caps the third housing loan at 70% primarily targets resident borrowers buying multiple properties; foreigners are still subject to bank-specific limits and may effectively see similar or lower caps.
• Your age at application matters: loan tenure is usually structured so that the loan ends by a maximum age limit set by the bank (often around 65–70 years).
Special case: MM2H property financing (example: CIMB)
For Malaysia My Second Home (MM2H) participants, some banks offer dedicated property financing packages. Using CIMB’s MM2H financing as a reference:
• Margin of finance can be up to about 80–85% for eligible MM2H applicants, subject to bank assessment.
• Financing is usually on a term loan or Islamic term financing basis, with competitive rates and standard monthly repayment.
• MM2H also involves placing a fixed deposit in Malaysia (e.g. structured FD tiers depending on category and age), which strengthens your profile in the eyes of the bank.
For an MM2H client eyeing a KLCC or Bukit Bintang unit, the practical advantages are:
• Higher possible loan margin versus a non‑resident without visa.
• Easier documentation trail (proof of MM2H status, local fixed deposits, clearer residential intent).
Other key rules for foreign property buyers
When you plan your loan, you must also consider the broader property rules that apply to foreign buyers:
• Minimum price threshold: each state sets a minimum purchase price for foreign buyers (often around RM1 million and above per unit in Kuala Lumpur).
• State consent: foreign purchases require State Authority Consent; if consent is not granted, the sale usually cannot proceed and deposits are refunded.
• Number of units: for properties above the foreigner minimum price, there is generally no limit to the number of residential units a foreigner can own, subject to bank approval and your financial capacity.
These rules are separate from loan approval, but banks will want to see that the property type and price comply with state regulations before fully disbursing the loan.
Typical documents banks ask from foreign buyers
Although every bank has its own checklist, you should be prepared with:
• Passport copy
• Proof of income (salary slips, employment letter, or company accounts if self‑employed)
• Latest bank statements (usually 3–6 months)
• Tax documents from your home country if applicable
• MM2H approval letter or work visa (if relevant)
• Sales & Purchase Agreement (SPA) or booking form for the property
These help the bank calculate your debt service ratio and assess how comfortably you can service the loan from overseas income.
Costs to budget for when buying with a loan
Beyond down payment and monthly instalments, foreign buyers should also plan for these costs:
• Legal fees and disbursements for SPA and loan documentation
• Stamp duty on the instrument of transfer and on the loan agreement (tiered depending on property value)
• Valuation fees (for sub‑sale properties)
• Possible bank processing fees
Malaysia’s costs of owning a property remained competitive compared with many developed markets.
Practical example: Investing in a KLCC condo
Imagine a foreign investor (no MM2H) buying a RM2 million freehold KLCC condominium:
• Minimum price rule: satisfied if the state minimum is RM1 million or lower for foreign buyers in that category.
• Expected loan margin: 50–60% (RM1.0–1.2 million), meaning down payment of RM800,000–1,000,000 plus transaction costs.
• In another scenario, a foreign investor obtains MM2H and buys another KL City property, the approved loan might reach 60–70% LTV, depending on age, income and overall exposure.
This is very different from a Malaysian first‑home buyer, who might get up to 90% LTV on a similar price bracket, so foreign buyers must plan for a higher cash component.
Strategic tips for foreign buyers targeting KL city centre
To improve your chances of getting the loan you want:
• Start early: speak to at least 2–3 banks or a mortgage broker before signing SPA, especially if you are overseas.
• Use your visa status: MM2H or an employment pass usually helps you secure better loan margins and tenures.
• Prepare strong documentation: stable, verifiable foreign income and assets make approval smoother.
• Choose bank and currency carefully: consider where your income is, and whether you prefer to borrow in MYR or elsewhere (some banks offer overseas mortgage loans for foreign properties and vice versa).
How I can help you as your KLCC / KL city centre agent
For international clients and foreigners interested in KLCC, Bukit Bintang or other prime KL locations, a well‑structured plan is essential:
• Shortlist properties that meet foreigner rules and bankable price ranges.
• Coordinate introductions to selected banks familiar with foreign and MM2H borrowers.
• Work with your lawyer to align the SPA timeline with loan approval and State Authority Consent.
If you are considering buying or investing in KL city centre and want to understand how much loan you can realistically secure, you can share me details like:
• Your country of residence
• Whether you hold MM2H / work visa or are purely overseas
• Your approximate budget and target area in KL
From there, I can suggest realistic property options and a loan strategy tailored to your profile.