Consider taking money out of the KWSP 2nd account to pay the mortgage?
Mortgage rates have increased in tandem with Bank Negara’s rate hikes. Consider taking money out of your EPF to pay off your mortgage if you are already unable to do so. Members of KWSP are permitted to take money out of the second account to pay for housing costs, construction costs, mortgage payments, and more!
Members of the Employees Provident Fund (KWSP) can apply to the Provident Fund to withdraw money to pay for the purchase, construction, or repayment of a mortgage, according to the information on the Provident Fund’s official website.
For the following purposes, members are permitted to withdraw money from the second provident fund account.
Members who wish to purchase or construct a home and who are under the age of 55 are eligible to withdraw money from the second account of the provident fund.
1. Get a loan
Members may request to have their deposits from the provident fund’s second account withdrawn in order to purchase a home. The maximum withdrawal that a member may request is the sum of the loan balance plus 10% of the home’s purchase price. whichever is less, or all deposits made in the member’s second account. Members’ second account deposit must be at least RM 500.
2.Build a home
Members can apply for a deposit in the provident fund’s second account to start building a home. The amount that can be used is the sum of the loan balance + 10% of the cost of building the house, less the cost of construction. whichever is less, or all deposits made in the member’s second account. Members’ second account deposit must be at least RM 500.
3. Reduce/pay off the mortgage balance
The mortgage balance or the deposits in the second account of the provident fund, whichever is lower, is the maximum that members may withdraw. The member must deposit RM 500 into their second account.
4. Pay the mortgage instalments
The mortgage balance or the deposits in the second account of the provident fund, whichever is lower, is the maximum that members may withdraw. The member must deposit RM 600 into their second account. Members will receive payment from the EPF Board in 6 monthly instalments, with a minimum withdrawal amount of RM100 per month.
EPF members can go to the nearby EPF counter to apply if they’re interested in taking money out of their second EPF account to pay off their mortgage, build a house, or buy one.
