PETALING JAYA: The new end-financing scheme for successful applicants of the 1Malaysia People’s Housing Programme (PR1MA) must be limited to first-time buyers only, said the National House Buyers Association (HBA).

Secretary-general Chang Kim Loong welcomed the initiative, which took effect from Jan 1, and allows PR1MA recipients to get a higher loan with lower monthly instalments.

“Due to the current economic slowdown, it is inevitable that banks will further tighten their lending process, so many prospective buyers could be denied financing.

“However, since this end-financing scheme is meant for a certain income group, we hope it remains restricted to first-time house buyers, since PR1MA has already allowed second-time house buyers to apply for housing as well,” he said in a statement.

The new scheme for PR1MA homebuyers offers “stepped-up” financing for the first five years and a second option to withdraw from the Employees Provident Fund (EPF) Account Two.

Under both options, a homebuyer pays only the monthly interest for the first five years; the principal amount is added on from the sixth year until the loan is paid off.

Chang also supported PR1MA’s proposal to the Government to begin the moratorium period for PR1MA homes at the date of the Certificate of Completion and Compliance (CCC), instead of the Sales and Purchase Agreement (SPA) signing date.

But he did not agree to the decision to halve the moratorium period, which had initially been set at 10 years.

“A moratorium period of only five years will encourage speculation.

“We have called for the moratorium to be reinstated at 10 years, but if the Government sticks to five years, then the time period must start from the date of vacant possession,” said Chang.