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Buy cheaper, that’s the best solution to ‘affordable.’

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Yes, a few ministers have been saying that they will help borrowers and potential borrowers. One has even asked that the travel ban be lifted and it has been done. Frankly, when these people do not pay, the future students will still have to borrow, right? The money will still be coming from tax payers, including me! Anyway, I am tired of talking about this. All those ‘rich’ friends of mine said it’s okay! These are young people and they will start paying when their salary reach a certain limit. Sigh… Next up is a minister asking the banks to ease lending rules. Huh? Easing lending rules so that those who could not borrow up to a certain limit be approved to borrow? How about a slightly better way then? Asking these borrowers to consider something cheaper instead? Come on, teach them how to use the online property sites and look for CHEAPER properties instead lah. There is nothing wrong to change the lifestyle to afford a certain home in some lesser known neighbourhoods lah.

It’s definitely wrong when one fails to save enough, keep spending too much and then when it comes to really needing to borrow, then ask for easier approvals? We are still a developing nation lah. Stop acting like a developed nation which actually caused the 2008 mortgage crisis yeah. Some people seem to agree with me though. Reported in edgeprop.my: easing home loan rules risky, say analysts  Analysts say that the plan to facilitate home ownershop among the youth and M40 and B40 may result in banks being “forced” to lend to these groups. They pointed out that the biggest group of those classified as bankrupt range from 25 to 44 years old. In fact, what may happen is that the government may relax the debt service ratio (DSR) from 60% currently. An analyst bluntly said this, “The reality is that Malaysians are highly geared,”  (Note: highly geared is also because they spent on the wrong things yeah…)  In 2015, according to data from the Malaysia Department of Insolvency, housing loan defaults were causing seven people going bankrupt every day because they could not service their housing loans. (Oh dear… 7 per day!) Fortunately, the gross impaired loan ratio in housing mortgages for banks stood at a mere 1.1% as at April, reported the weekly. (Yes, bad debts remain pretty low but this is also due to everyone having a job yeah…)

Some analysts even suggested that developers should create products that are truly affordable or to look at the lending criteria more flexibly. For example, if it’s the first loan, then the banks can also allow for borrowers’ variable income to be taken into consideration. Perhaps some online biz which is profitable? (Yeah, perhaps GRAB’s incomes can be added in too. Plus if it’s shown that their parents have been giving them allowances every month without stopping for the past 12 months, chances are the allowances will continue? Haha)  Anyway, do refer to the full article in EdgeProp.my if you like to read more yeah.  Seriously, debt issue is a serious issue everywhere. The youths will still be youths lah. If we already know the reasons why they spend too much, perhaps that should be a better start. Secondly, if they really do not know what to buy for example, how about giving them free access to some financial investment resources instead? There are a lot of things that could be done. It does not need to be a simply simple one called, ‘lower your standards’ please. Happy buying.

written on 15 June 2018

Next suggested article:  71 percent of loans to first-time home buyers. Positive.

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