An average of 40% DSR is what majority financial institutions would accept, some up to 60% and some as high as 30% for
1. Consolidate advancements to minimize monthly repayments
Consolidating your debts could lower your interest rate altogether, besides saving your hassle to pay off the number of loans tied around your belt. Not only financial institutions take into consideration the available balance but also your loan balances. Get a debt reduction plan to cover your smaller loans/advancements first. For example, credit card debts.
2. The financial obligations ratio (FOR) for Malaysian home loans
Includes automobile lease payments, rental payments on tenant-occupied property, payments on consumer debt and automobile leases, mortgage debt, homeowners' insurance, and property taxes, homeowner’s insurance, and property tax payments – All contribute to the percentage of debt service ratio (DSR). You can also check out the Home Loan Calculator.
3. Settle intended debts 1 month prior to
Financial organizations scour through a reference information system. While the reports are usually out at least once a month, settling your debts would definitely give you an advantage over the home loan process.
4. Declare other income sources to improve DSR
Some financial organizations calculates your DSR based on your primary and secondary income. Includes rentals, salary interests, capital gains from mutual funds, insurance commissions, director fees, share capital gains or dividends or profits from companies.
5. Joint applicants
For joint applicants, both incomes will be taken into consideration. This creates a stronger DSR.
Financial organizations will look into your home loans more favourably if you have a solid DSR. Most likely, those with stronger DSR tend to take shorter approval time and better chance of securing