PETALING JAYA: If your housing loan application for an affordable home in Terengganu is rejected by banks, fear not as the state government has set aside RM50 million yearly in interest-free loans.

The i-Rahman scheme, launched on Oct 13 by the state, will help 709 households from the B40 group to own houses each year.

“Most people in the lower-income group in Terengganu will not meet loan requirements of commercial banks,” State Local Government, Housing, Health and Environment Committee chairman Dr Alias Razak told theSun.

“Most of them do not have fixed incomes. How can they show their payslips to banks if they do not have full-time jobs?”

There are two loan facilities under i-Rahman. One is for the purchase of houses from private developers called “Rumah Mampu Milik Terengganu” (RMMT) while the other is to enable borrowers to build houses on their own land under “Rumah Mesra Rakyat Darul Iman” (RMR Rahman).

“Landowners can apply for the RMR Rahman scheme for which the state government will work with Syarikat Perumahan Nasional Berhad (SPNB) to build the houses.

“SPNB, which comes under the Finance Ministry, has experience in building affordable housing nationwide.”

The price for an RMR Rahman unit is RM75,000, but those who are eligible for this scheme will only need to repay RM55,000 over 15 years. The remaining RM20,000 will be subsidised by the ministry.

Each RMR Rahman unit is a 1,000sq ft single-storey house with no parking space. It has three bedrooms and two bathrooms. A deposit of RM3,500 is required for each application.

Those who want to buy an RMMT property but do not meet bank requirements can apply for the i-Rahman scheme. They must furnish loan rejection letters from at least two banks.

“This is for those who have the money to make monthly loan repayments but are renting. They cannot get loans because they have no payslips to show,” Alias said.

The maximum price for a unit of RMMT is RM80,000 and the loan repayment is RM266.70 per month over 25 years.

“The state government is allocating RM50 million every year from its budget for this initiative, with 30% or RM15 million for RMR Rahman and 70% or RM35 million for RMMT house loans.

“We estimate 272 RMR Rahman units to be built per year and 437 applicants for RMMT.”

Financial management for the i-Rahman scheme will be done by Perbadanan Memajukan Iktisad Negri Terengganu, a state government agency.

“Our loans are different from those of commercial banks because there are no extra charges. There is no interest or service charge. Those eligible only repay the amount borrowed for a house.

“Although some banks are considered as syariah compliant, they increase the prices of houses to sell them to borrowers. We do not do that.”

Alias said this initiative is one of the solutions to overcome socio-economic problems in the state.

“As the per capita income in Terengganu is different from other states, this is our way of helping people to own homes.”

According to the Statistics Department, the state’s average monthly salaries and wages in 2020 fell from RM2,766 in 2019 to RM2,424.

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