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By Jason Lim, REN 84424 · IQI Realty · Checked on 15 November 2026
This guide is for buyers in Johor Bahru, from Malaysia, Singapore, Indonesia, India, China and elsewhere, who keep hearing the term “end financing”. The short answer: end financing is simply the buyer’s own housing loan, as opposed to the developer’s construction (bridging) loan. For a new launch the bank pays the developer in stages as the building goes up and you pay interest only on what has been released; for a subsale the bank pays the seller in one sum at completion. Either way, the loan is in your name from day one.
Quick answer
- What it is: the loan a buyer takes to pay for a property. Bank Negara Malaysia (BNM) has long used the term to separate it from bridging finance, which banks lend to developers.
- New launch: you pay the first 10% and any balance above the loan yourself; the bank then pays each progress bill under the statutory Schedule G or H agreement.
- Interest: during construction you pay interest only on the amount released so far, so the monthly cost grows as the project rises.
- Subsale: the bank releases the loan in one sum at completion, often first redeeming the seller’s loan.
- Loan rejected on a new launch: if your income is not enough and you prove it to the developer, you pay 1% of the price, the agreement ends and the rest is refunded within 30 days (clause 6(3)).
- DIBS: since a BNM circular in November 2013, banks may not end-finance homes sold under interest capitalisation schemes such as DIBS.
General information, not financial or legal advice; your letter of offer and sale and purchase agreement (SPA, perjanjian jual beli) govern.
What end financing means, and how it differs from bridging finance
Two loans sit behind most new launches. The developer borrows to buy the land and build: bridging or project finance, often secured by a charge over the master title. You borrow to pay the price: end financing, from your end financier (pembiaya hujung). BNM treated the two separately as early as its January 1999 property financing guideline.
| Bridging (project) finance | End financing | |
|---|---|---|
| Borrower | The developer | You, the buyer |
| Purpose | Land and construction costs | Paying the purchase price |
| Security | Usually a charge over the developer’s land or master title | A charge on your title, or an assignment of your rights under the SPA if no individual title exists yet |
| Who repays | The developer, from sales | You, through monthly instalments |
It is not a special product: a normal housing loan or Islamic home financing, paid to the developer or seller rather than to you. My guides to the bank letter of offer and Islamic home financing cover the loan terms themselves.
End financing for a new launch, step by step
Licensed developers in Peninsular Malaysia, Johor included, must use the statutory SPA forms: Schedule G (landed) and Schedule H (strata), as amended from 1 July 2015 (P.U.(A) 106/2015). Clauses 3 and 6 set out how your loan works.
- Apply within 30 days. Within 30 days of receiving the signed SPA; the developer must use its best efforts to help (clause 6(1)).
- Accept and sign. After approval you have 30 days to sign the loan documents and pay fees, legal costs and stamp duty, which is 0.5% of the loan (clause 6(1); LHDN).
- Pay your own share first. The 10% on signing and any part of the price above your loan, before the bank pays anything.
- Undertakings are exchanged. Your bank undertakes to pay according to the payment schedule; the developer undertakes to refund the bank if the title cannot be registered to you through no fault of yours (clause 6(6)).
- The developer’s charge is dealt with. If the land is charged to the developer’s bank, the developer must provide that bank’s redemption statement and undertaking. Your bank pays early instalments to it up to the redemption sum, and any shortfall must be settled before you have paid more than 50% of the price (clauses 3(3) and 3(4)).
- Progress bills are paid. As the architect certifies each stage, your bank pays into the project’s Housing Development Account.
A May 2022 Malaysian Bar article adds that the end financier’s lawyer obtains a letter of disclaimer from the developer’s bank, so its charge cannot be enforced against your unit once the redemption sum is paid. If your project has no individual or strata title yet, see buying without an individual or strata title.
How the drawdown and interest build up
| Stage under Schedule H | Bill | Paid by | Loan released so far | Monthly interest at an assumed 4% |
|---|---|---|---|---|
| Signing (10%) | RM60,000 | You pay | – | – |
| Foundation (10%) | RM60,000 | Bank | RM60,000 | About RM197 |
| Structure (15%) | RM90,000 | Bank | RM150,000 | About RM493 |
| Walls (10%) | RM60,000 | Bank | RM210,000 | About RM690 |
| Roof and services (10%) | RM60,000 | Bank | RM270,000 | About RM888 |
| Finishes (10%) | RM60,000 | Bank | RM330,000 | About RM1,085 |
| Sewerage, drains and roads (10%) | RM60,000 | Bank | RM390,000 | About RM1,282 |
| Vacant possession (17.5%) | RM105,000 | Bank | RM495,000 | About RM1,627 |
| Title and stakeholder sum (7.5%) | RM45,000 | Bank | RM540,000 | About RM1,775 |
Interest starts from the first release, not from handover, and is normally the buyer’s cost. Full instalments start on the date or event in your letter of offer, which banks word differently. The progressive payment schedule guide explains every stage, and my home loan calculator shows the full instalment. BNM kept the Overnight Policy Rate (OPR) at 2.75% on 5 November 2026 (see how the OPR reaches your instalment).
Planning a new launch purchase in JB?
Send me the project and price. I’ll map out what you pay yourself, when the bank starts paying, and roughly how the interest builds up during construction.
WhatsApp JasonEnd financing for a subsale
Buying from an owner, the loan is released in one sum at completion. The usual order:
- Your share first. The deposit and the rest of your own money (price minus loan). See the differential sum explained.
- The seller’s loan, if any. If the title is charged, part of your loan redeems it. See buying when the seller has a loan and discharge of charge.
- The balance to the seller. Paid once the transfer and your bank’s charge are ready for registration.
Interest runs from that release. The completion period is set in the SPA; the Malaysian Bar article suggests allowing about three months for the end financier’s lawyers’ checks. My subsale timeline for JB shows where the loan fits.
Why “the developer pays your interest” deals ended
Under the Developer Interest Bearing Scheme (DIBS), the developer covered your interest during construction. The ban was announced in the Budget 2014 speech, and a BNM circular that took effect in mid-November 2013 stopped banks from giving end financing for property sold under interest capitalisation schemes, including DIBS, and from giving bridging finance to projects offering them. In my checks in November 2026, nothing had brought DIBS back. If a pitch sounds similar, ask whether your bank will finance it; see my DIBS guide.
If your loan is rejected after you sign
| Situation | What usually happens | Where it comes from |
|---|---|---|
| New launch: loan refused because your income is not enough | You show proof to the developer, pay 1% of the price, the SPA ends and the developer refunds the rest within 30 days | Schedules G and H, clause 6(3) |
| New launch: you decline an offered loan, fail its conditions or lose eligibility | You remain liable to pay the full unpaid price | Clause 6(4) |
| New launch: government housing financing (for example LPPSA) not obtained | You remain liable for the full unpaid price; no late-payment interest for the first six months from the SPA date | Clauses 7(2) and 10(3) |
| Subsale: loan refused | Depends on the loan condition in your offer letter or SPA; without one, you may be in default and lose the deposit | Your SPA |
| Any purchase: valuation below the price | The bank lends on its valuation, so you top up the gap from your own money | Your letter of offer |
Get a loan approval in principle before you book and keep a cash buffer for a lower valuation. My guides to why housing loans get rejected, valuations below the price and backing out after the SPA go into detail. Civil servants using public-sector financing can read my LPPSA guide.
If the developer stalls during construction
Your loan does not pause when the site does: a National House Buyers Association FAQ reminds buyers to keep servicing it, talk to the bank and report the project to the housing ministry. Section 8A of the Housing Development Act 1966 (Act 118) lets a buyer terminate where the developer refuses, suspends or stops work for a continuous six months or more, with the end financier’s written consent (which may not be unreasonably withheld) and the Controller of Housing’s certification; the developer must then refund within 30 days. See abandoned housing projects and checking a developer before you buy.
End financing for foreign buyers in Johor
- Borrowing in ringgit is allowed. BNM’s Foreign Exchange Policy Notices (in force 1 October 2025) let non-residents borrow ringgit from a resident lender for real sector activity, which includes buying residential or commercial property.
- Fewer lenders, smaller margins. Many banks lend foreigners a smaller share than locals. See home loans for foreigners and financing JB property from Singapore.
- State consent comes first. Banks generally release funds once required approvals, such as state approval, are in place. In Johor, foreigners can generally buy homes only from RM1 million, with only limited exceptions (for example, some serviced apartments sold by developers with state approval); no area is exempt as a whole. The state approval fee is 3% of the price, minimum RM30,000 (PTG Johor, from 1 July 2025). See Johor’s foreigner minimum price and state consent in Johor.
- Other costs. Foreign buyers pay a flat 8% stamp duty on residential transfers from 1 January 2026. See paying for Johor property from abroad.
For MM2H, I coordinate with a MOTAC-licensed MM2H agent; approval is decided by the authorities. See my MM2H property support page.
Checklist before you sign
| Question | Why it matters |
|---|---|
| Has a bank given me an approval in principle for this property? | Reduces the risk of signing and then failing to get a loan |
| What margin and amount did the bank offer, and on what valuation? | Sets your own share; see margin of financing rules |
| Is the land charged to the developer’s bank, and has it given a redemption statement and undertaking? | Protects your unit from the developer’s lender |
| For a subsale: is there a loan condition, and for how long? | Decides whether your deposit is protected if the loan fails |
| Is this my third housing loan? | BNM caps it at 70% of the property value (since November 2010); see second and third home loans |
Where to buy if this matters to you
- New launches in Johor Bahru: projects under construction, where staged end financing applies.
- Iskandar Puteri: newer townships near the Second Link.
- JB Sentral and Bukit Chagar: high-rises near the CIQ and RTS Link station.
- Mount Austin: an active resale market for subsale buyers.
- Permas Jaya and Senibong: east-side condos and waterfront landed homes.
- Bukit Indah and Gelang Patah: landed and strata homes.
Compare them on my JB property map.
More Johor living guides: How much house can I afford? · The SPA explained · Developer charges at key collection · Home loan lock-in periods
Frequently asked questions
What is end financing in Malaysian property?
It is the buyer’s own housing loan or Islamic home financing used to pay the price, as opposed to bridging finance, which the developer borrows to buy land and build.
When does interest start on a loan for an under-construction home?
From the first release. During construction you pay interest only on the amount the bank has paid to the developer so far, and full instalments start on the date or event stated in your letter of offer.
How is end financing different for a subsale?
For a subsale the bank releases the loan in one sum at completion, after you have paid your own share. Part of it may go first to redeem the seller’s loan, with the balance paid to the seller.
What happens if my loan is rejected after I sign a new launch SPA?
Under clause 6(3) of Schedules G and H, if your income is not enough for a loan and you prove it to the developer, you pay 1% of the price, the SPA ends and the rest is refunded within 30 days. Declining an offered loan leaves you liable for the full price.
Can a developer still pay my interest during construction?
Not under a scheme banks will finance. Since a Bank Negara circular took effect in mid-November 2013, banks may not give end financing for property sold under interest capitalisation schemes such as DIBS.
Can foreigners get end financing for Johor property?
Yes, subject to bank policy. Bank Negara’s rules let non-residents borrow ringgit to buy property, but fewer banks lend to foreigners, and Johor’s RM1 million floor and state approval still apply.
Buying with a loan in JB?
Tell me the property type (new launch or subsale), price range and financing plan. I will walk you through your cash share, when the bank starts paying and what to check with your lawyer and bank. You can also book an appointment for viewings, or a Zoom consultation if you are still abroad.
Sources: Housing Development (Control and Licensing) (Amendment) Regulations 2015, P.U.(A) 106/2015, Schedules G and H (clauses 3, 6, 7, 10, 11 and Third Schedule), in force 1 July 2015; Bank Negara Malaysia, “Financing of properties” (bridging finance and end-financing), 6 January 1999; Malaysian Bar, “Conveyance lawyer: Professional service trumps theoretical knowledge (Part 2)”, 30 May 2022; The Star, BNM circular on interest capitalisation schemes, 20 November 2013; Malay Mail, Budget 2014 DIBS ban, 25 October 2013; Bank Negara Malaysia, property market measures (70% LTV from the third housing loan), 3 November 2010; Bank Negara Malaysia, Monetary Policy Statement, 5 November 2026; Bank Negara Malaysia, Consolidated Foreign Exchange Policy Notices (Notice 2, para 15(a), and definition of real sector activity), in force 1 October 2025; National House Buyers Association, FAQ on housing loans, accessed November 2026; Attorney General’s Chambers, Laws of Malaysia: Housing Development (Control and Licensing) Act 1966 (Act 118), section 8A, checked November 2026; LHDN, Garis Panduan Pengenaan Duti Setem, First Schedule, Stamp Act 1949 (loan instruments 0.5%; 8% for foreign buyers), 30 June 2026; PTG Johor, Pekeliling Bil. 3 Tahun 2025 (foreign-interest approval fees), in force 1 July 2025; New Straits Times, “Foreigners hit Johor property resale wall” (RM1 million floor), 20 April 2026
Jason Lim, REN 84424, IQI Realty Sdn. Bhd. E (1) 1584/6. General information checked on 15 November 2026, not legal or financial advice. Bank policies, rates and housing rules change; your SPA, letter of offer and loan agreement govern your purchase, so confirm the terms with your bank and your lawyer before you sign.