Bank taking long
time to process housing loan
28/1/2005 The Star
I APPLAUD the recent decision by Bank Negara Malaysia to regulate the excessive
charges imposed by banks and increase transparency in this industry.
Going forward, I urge Bank Negara to help increase expediency and efficiency
in our banking system.
About four months ago, I bought a new property under construction.
Under the sale and purchase agreement (S&P) signed between the developer and
me , I was given 30 days with another 30 days' grace period to obtain and
finalise all financing for the purchase.
Immediately after executing the S&P, I went to a local bank to obtain financing.
Nearly four months down the road, my loan has yet to be disbursed and consequently,
I was slapped with a hefty late payment penalty by the developer.
I am very perturbed by the incident as the bank insisted that it would normally
take up to three months to finalise and disburse a home loan while the developer
has given me a timeframe of two months.
Firstly, I would like to pose to the Housing and Local Government Ministry
whether developers are allowed to impose such late payment penalties and whether
the two-month timeframe is reasonable.
Secondly, I would like to propose to Bank Negara to impose a guideline on
maximum processing time taken by banks to approve and release loans.
I found out from other banks that the processing time varies from three weeks
to four months (such as my case).
If not for the fact that I had to pay such a large amount for the penalty,
I would have found it amusing that our banks are so inefficient and wonder
what would it be like when financial liberalisation fully takes effect in
the near future.
Based on the unsavoury episode that I have just experienced, there appears
to be a discrepancy in the system. Consumers will always be victims to the
developers and at the mercy of the banks.
I hope the authorities will look into this matter seriously.