Higher loan entitlement for EPF members

Employees Provident Fund (EPF) members who did not withdraw under the scheme to purchase a house or reduce their housing loans, can purchase a house of higher value from Aug 1.

The EPF said on Thursday, July 29 the "Flexible Housing Withdrawal" scheme is to give qualifying members greater purchasing power.

Under this facility, a member’s current and future savings with the EPF will be considered when an application for a housing loan is made to financial institutions, it said.

EPF chief executive officer Tan Sri Azlan Zainol said the move was to support the government’s objective to enhance the quality of life of the Rakyat in the spirit of 1Malaysia. Members can now have a chance to realise their dream of a better home for their families via increased home loan eligibility.

“What's more, the Flexible Housing Withdrawal does not in any way affect a member’s retirement savings as savings that have been set aside under this facility will continue to earn the yearly dividends paid by the EPF,” Azlan said.

The facility is available to members below the age of 54 at the point of application and must be applied together with their application for "EPF Withdrawal to Purchase/Build a House" or "Withdrawal to Reduce Housing Loan".

He said a member may transfer part of his or her savings in Account 2 to the "Flexible Housing Withdrawal" account and then followed by a monthly transfer of a specified amount of contribution to this account.

Savings that have been set aside under "Flexible Housing Withdrawal" cannot be withdrawn or used for any other pre-retirement withdrawals namely housing, education, medical and at age 50 before the end of the "Flexible Housing Withdrawal" term.

Members however can still utilise the remaining savings in Account 2 for other pre-retirement withdrawals.

Written by Joseph Chin