17 January 2022

What is Skim Saraan Bercagar (SSB) ~ Reverse Mortgage?

Are you struggling or worried about your retired life? And, do you have a fully paid-up residential property under your name? Good news. 😍😍😍

As a homeowner, you are “asset-rich” through housing equity. Do you know that you can turn your residential property into a fixed monthly income stream throughout your retirement years?

You have an option now to fund your retirement life now with this new scheme called 'Reverse Mortgage'.

What is Skim Saraan Bercagar (SSB) or Reverse Mortgage?

Skim Saraan Bercagar ("SSB") or Reverse Mortgage (“RM”) by Cagamas is a type of loan that is targeted for the elderly or retirees who own a home, and allows them to convert their one big asset — their residential property — into a fixed monthly income stream throughout their lifetime, without sacrificing ownership whilst continuing to stay in their home.
  • To enable retired homeowners to gain access to a lifetime of supplemental income stream for daily subsistence.
  • Homeowners can now draw on their home equity to supplement their retirement income, thus reducing dependency on their next-of-kin.
  • This allows you to continue staying in your family home without repayment during your lifetime.
  • Retired homeowners can use the monthly payout amount for any purpose, such as medical-related expenses and other necessities to make their retirement years more comfortable.

The Skim Saraan Bercagar Loan only requires settlement upon the demise of the borrower or joint borrower, whichever occurs later. No repayment is required during their lifetime and the property will only be sold to settle any outstanding loan amount upon the demise of the borrower or last surviving joint borrower. Any residual balance from that will go towards your estate.

"Cagamas Berhad (Cagamas), the National Mortgage Corporation of Malaysia, was established in 1986 to promote the broader spread of home ownership and growth of the secondary mortgage market in Malaysia."

Four Key Benefits of Skim Saraan Bercagar (SSB) Reverse Mortgage
  1. Lifetime tenure
    You’ll have a fixed monthly source of income throughout your retirement years.

  2. Repayment happens later
    You don’t have to worry about repayment during your lifetime as it will only happen when you or the joint borrower passes away, whichever occurs later.

  3. Home sweet home
    You are able to reside in your home throughout your retirement years.

  4. A non-recourse loan
    If the eventual sale proceeds of the property is less than the outstanding loan amount, your family or your estate will not be responsible for any shortfall to settle the Skim Saraan Bercagar Loan.
The Eligibility Criteria are as follows:

Good. How to apply?

Follow each of the steps below and you’re on your way to secure a fixed monthly income throughout your retirement years.

Additional info for Step 1:
You can schedule an appointment with EPF at any of the branches below via this link: https://www.kwsp.gov.my/ms/janjitemu

Additional info for Step 2:
Here is some basic information that you would need to provide:
  • Age of borrower or borrowers (for joint SSB Loan)
  • Estimation of property's market value
  • Type of property
  • Location of property
  • Land title of property (i.e. Freehold or Leasehold)

Any costs involved?
If yes, who will bear the costs?

Upon signing up for the Skim Saraan Bercagar Loan, here are some expenses that will be incurred by the borrower. Initial upfront expenses:
  • Legal fees
  • Valuation fees
  • Property insurance
  • Administration fees (if any)
  • Servicer fees (if any)
The initial expenses above can be financed by the Skim Saraan Bercagar Loan.

How about leasehold properties? Can?

Good question. Yes, leasehold properties with at least 90 years of lease remaining OR at least 60 years of lease remaining after deducting the remaining expected life of the borrower, are allowed.

Otherwise, the borrower may need to renew the lease to be eligible.

“For the pilot launch of the scheme, the SSB loan will be offered at a fixed rate financing of 5% per year on the outstanding loan amount and a one-time upfront recourse waiver fee of 1.75% on the initial property value”

Source: SSB Cagamas

Click here to download the application form.
Click here to download the brochure.

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