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Purchasing a house

If you are looking to buy a house with your EPF, you need to check your savings in EPF Account II. With these funds, you can purchase a house or shop house with a dwelling unit either on your own or jointly with your spouse, family members or other individuals.

The amount you may withdraw from Account II is calculated based on:
the price of the house
the maximum you can obtain as a loan from the bank, plus
10% of what the house costs.

Example 1: Individual Purchase with a housing loan
Ahmad wants to buy a house costing RM200,000. He has RM30,000 in her EPF Account II, and manages to obtain a RM180,000 bank loan. Based on the three factors above,

Price of the house	RM 200,000
Housing loan	RM 180,000
Difference between price of the house and housing loan	RM 20,000
Additional 10% of the price of the house	RM 20,000
Amount eligible for withdrawal	RM 40,000
Amount in Account II	RM 30,000
Amount that can be withdrawn	RM 30,000

Ahmad can withdraw only RM30,000 from Account II, which is less than the amount eligible for withdrawal, because that is the maximum in her account.

Example 2: Individual Purchase without a housing loan
Tan intends to purchase a house worth RM300,000. He doesn’t want to take a housing loan as he has already paid RM30,000 to the developer. However, he has RM50,000 in his EPF Account II. For Tan, the calculation will be:

Price of the house	RM 300,000
Housing loan	NIL
Difference between price of the house and housing loan	RM 300,000
Additional 10% of the price of the house	RM 30,000
Amount eligible for withdrawal	RM 330,000
Amount in Account II	RM 50,000
Amount that can be withdrawn	RM 50,000

Tan will be able to withdraw all his savings in Account II.

Example 3: Joint Purchase with a housing loan
John and Jane decide to buy a RM250,000 house. They jointly obtain a housing loan of RM250,000. John has RM20,000 in her EPF Account II, and Jane has RM15,000. In their case, the scenario is a little different:

Price of the house	RM 250,000
Joint housing loan	RM 250,000
Difference between price of the house and housing loan	NIL
Additional 10% of the price of the house	RM 25,000
Amount eligible for withdrawal by Carol and Jane	RM 25,000
Amount in Carol’s Account II	RM 20,000
Amount in Jane’s Account II	RM 15,000
Amount that Carol can withdraw	RM 20,000
Amount that Jane can withdraw	RM 5,000

Since John and Jane have obtained a 100% housing loan, the total amount that needs to be withdrawn is 10% of the price of the house, ie, RM25,000. The EPF will process Carol’s withdrawal application of RM20,000 first, followed by Jane’s application of RM5,000.

How do I apply for withdrawal of funds from my EPF Account II?

EPF contributors who wish to apply to withdraw funds from their EPF Account II for the purchase of houses have to complete Form KWSP 9C (AHL) and submit it with the following documents where applicable:

-	Identity Card, Smart Card, or – in the case of police or military personnel – Police/Military Identification Card. (Please note that police or military personnel must produce a letter from their respective departments confirming their identification card number.)
-	Smart Card holders should provide a photocopy of the Smart Card with right and left thumb prints on the photocopy.
-	Sale & Purchase Agreement executed not more than three years before the date the application is received by the EPF. (In the case of joint purchase, the names of all applicants must be on the SPA.)
-	Housing Loan Approval letter or Housing Loan Agreement (if application is submitted after one year from the date of Loan Agreement).
-	EPF contributor’s individual savings account book or individual current account statement which indicates a still-active account.

If contributors self-finance the purchase of the house, they are also required to submit:

-	Developer’s letter confirming the purchase paid in cash.
-	Payment receipt of not less than 20% of the purchase price of the house.
-	Letter requesting the progress payment of at least 20% together with the Architect Certificate.

Submission of Application

All application forms can be submitted to any EPF office either at the counter or by post. If submitted at the EPF counter, original documents must be produced together with their photocopies. Applications submitted by post must have photocopies of the required documents certified by EPF-authorised officers.

Withdrawal for a Second House

Since 2 Jan 2001, EPF are also allowed to withdraw from their Account II to purchase their second house on condition that the first house, which was funded from their EPF savings, has been sold.

EPF members are required to submit documentation on the sale of their first property, covering:

If the house is purchased before 2 Jan 2001, members can only withdraw to reduce or redeem their housing loan only.

Reducing or Redeeming the House Loan

You may also reduce/redeem your housing loan using your savings in Account II. This can be done for individual or joint purchases, or to assist your spouse in reducing or redeeming outstanding housing loans.

Please note that this withdrawal is solely to reduce or redeem housing loans under the following circumstances:

-	If you have withdrawn your savings to purchase prior to November 1994, you can withdraw your savings for any house you have purchased;
-	If you have withdrawn your savings to purchase a house after November 1994, you can withdraw your savings for the same house only;
-	If you have never withdrawn your savings, you may do so for any house;
-	If you have purchased a second house before 2nd January 2001, your first house must have already been sold.

-	An outstanding housing loan with an authorized financial institution;
-	Not reached 55 years of age at the time the application is received by the EPF;
-	Obtained housing loan(s) from financial institutions cited under the Bank & Financial Institution Act (BAFIA), Federal/State Government or other financial agencies, your employer, or a licensed co-operative society/company;
-	Mortgaged the house to the financial institution concerned;
-	Refinanced your loan.

Enquiries

If you have any enquiry or problem relating to your withdrawal application, please contact the nearest EPF Office or the EPF Customer Service Department at:

Please remember to quote your EPF Membership number and the withdrawal scheme that you have applied for when you contact the EPF. You are encouraged to contact the EPF directly to obtain assistance and advice.

For further information on the EPF guidelines, please visit the EPF website http://kwsp.gov.my