Housing Loan Interest Rate in Malaysia (2025)

If you’re planning to buy a home in Malaysia this year, understanding the latest housing loan interest rates is crucial to making an informed decision. Interest rates directly impact your monthly repayments and the total cost of your loan over time. Here’s a detailed breakdown of housing loan rates in Malaysia for 2025, along with insights into how they work and how you can secure the best deal.

Overview of Housing Loan Interest Rates in Malaysia (2025)

The table below shows the general range of housing loan interest rates currently offered by banks and financial institutions in Malaysia for 2025:

Note: These figures are indicative. Rates may vary depending on the bank, applicant profile, property type, and ongoing promotions.

How Housing Loan Interest Rates Work in Malaysia

To make sense of the numbers above, it’s important to understand how interest rates are calculated and applied to your mortgage.

1. Base Rate (BR)

The Base Rate is the minimum interest rate set by each bank. It reflects the bank’s cost of funds and the Statutory Reserve Requirement (SRR) set by Bank Negara Malaysia. Housing loans in Malaysia typically follow a BR + Spread structure.

2. Spread

This is an additional percentage added to the base rate. For example, if a bank’s BR is 3.50% and the spread is 0.60%, your final interest rate will be 4.10% p.a.

3. Effective Lending Rate (ELR)

The Effective Lending Rate reflects the true cost of borrowing, accounting for compounding interest and applicable fees. It’s the most accurate figure to use when comparing loan offers across banks.

Factors That Influence Housing Loan Interest Rates

Several factors can impact the interest rate you’re offered on a mortgage in Malaysia:

✅ Type of Housing Loan

• Fixed Rate Loans: The interest rate remains constant throughout the loan tenure, providing certainty but typically at a higher rate.
• Floating/Variable Rate Loans: The interest rate can increase or decrease based on changes to the base rate.
• Semi-Flexi Loans: Allows flexibility in repayment (e.g., advance payments or redraws) while still pegged to a floating rate.

✅ Loan-to-Value (LTV) Ratio

A lower LTV—meaning you borrow less relative to the property’s value—can qualify you for more attractive interest rates.

✅ Loan Tenure

Longer loan terms can lead to slightly higher interest rates due to increased risk for the lender.

✅ Your Credit Score

A higher credit score indicates lower risk and increases your chances of getting a lower rate.

✅ Promotions and Bank Packages

Banks often run limited-time offers with discounted rates or waived fees. Always check if there are active promotions that fit your loan requirements.

Where to Find the Best Housing Loan Interest Rates in Malaysia

To ensure you’re getting the most competitive rate, use these resources:

🔍 Loan Comparison Platforms

• RinggitPlus
• Loanstreet
• iMoney

These sites allow you to compare multiple banks’ home loan products side by side.

🏦 Bank Websites

Visit the official websites of major Malaysian banks like Maybank, CIMB, RHB, Hong Leong Bank, and Public Bank to view their latest housing loan rates, terms, and promotional offers.

👨‍💼 Financial Advisors and Mortgage Consultants

If you’re unsure which loan suits you best, a licensed mortgage consultant or financial advisor can help analyze your financial situation and recommend the most suitable option.

Key Tips Before Applying for a Home Loan

• Stay Updated: Housing loan interest rates in Malaysia can change based on monetary policy and market trends. Always re-check current rates before submitting your application.
• Compare ELR, Not Just Interest Rates: A lower advertised rate doesn’t always mean a cheaper loan. Compare Effective Lending Rates and consider all fees and charges.
• Pre-Qualify: Use mortgage calculators to estimate your monthly repayments and determine how much you can realistically borrow.

Final Thoughts

Securing a home loan with a favorable interest rate can save you thousands of ringgit over the loan tenure. Take the time to compare offers, understand the fine print, and consider your long-term financial goals. Whether you’re a first-time homebuyer or refinancing an existing loan, being informed is the key to smarter borrowing.