KUALA LUMPUR: Bank Negara Malaysia has introduced a standardised housing loan and home financing agreement for retail borrowers.
Under this initiative, financial institutions are required to cease imposing any fee, whether directly or indirectly, on housing loan and home financing documents to lawyers, with effect from Feb 1 this year.
The move seeks to enhance the quality-of-service delivery, promote consumer understanding and comparability of key terms and conditions, and simplify language in such agreements, including borrowers' and financiers' responsibilities and obligations.
"Standardising the housing loan and home financing agreement is a significant step forward in enhancing customer protection in the financial industry," said the Association of Islamic Banking and Financial Institutions Malaysia (AIBIM) president Mohd Muazzam Mohamed.
AIBIM also said the new implementation seeks to abolish documentation fee imposed by the financial institutions, of which its cost ranges from RM20 to RM200.
The association said the implementation came through after the documentation fee for housing loan was brought up by Special Task Force to Facilitate Business (Pemudah) and after careful evaluation, BNM proceeded with the implementation.
"AIBIM members fully supported this initiative," Muazzam said in a statement today.
The statement said the move reinforced Bank Negara's commitment to promoting fair consumer outcomes in the financial industry.
This is in accordance with the Policy Document of Fair Treatment of Financial Consumers, as well as other relevant policy documents, guidelines and circulars issued by the central bank.