Buying our own home is definitely a milestone in our life, and it’s probably one of the biggest purchase for most of us. However, with the current economy and higher cost of living, many are afraid to commit. It’s not entirely about not being afford the repayments but it’s mainly the fear of not being able to service the repayments during difficult times. Now, do you know that you can actually withdraw your EPF Account 2 funds to help service your monthly repayments or reduce your home loan?

Below is a simple table how EPF Account works. Account 1 consists of 70% of your funds while Account 2 consists of 30%. In this article, we will focus on the home mortgage withdrawal. ou can read here for more details on EPF withdrawal.


1) Withdrawal to Purchase/Build a House

This can be done within 3 years from the date of the signed Sales & Purchase Agreement, with the condition that you can only make one withdrawal for any of your properties. Therefore, you should choose one with a higher SPA price. However, you can actually still make subsequent withdrawal if you have lost ownership for the first house. Proof of disposal must be submitted.


2) Withdrawal to Reduce/Redeem Housing Loan 

This can be done for any property of your choice, provided that you have not made any types of withdrawal before. If you have made prior withdrawal, only the property that you have applied for withdrawal can still be entitled for another withdrawal under this category, until you have lost ownership of it. Withdrawal can be done ONCE ANNUALLY from the previous date of withdrawal. You can decide on the amount of withdrawal as well.


3) Housing Loan Monthly Instalment Withdrawal 

This withdrawal is pretty similar to the above, except that the withdrawal under this category is paid out on a monthly basis. Similarly, this withdrawal can be done for any property of your choice, provided that you have not made any withdrawal before. If you have, only the property that you have applied for withdrawal can still be entitled for another withdrawal under this category, until you have lost ownership of it. However, do note that your respective bank has the right to determine the tenure of withdrawal.


Here are the few simple steps to make withdrawal under the 2nd and 3rd category!


Lastly, despite having these options available, you have to know that such withdrawal will greatly reduce your retirement fund. This will in turn affect your opportunity to gain compounding interest. Do contact a financial advisor prior to your decision!

Here’s an additional tip: You can download the EPF I-akaun app on your phone for easy access to your account information including the amount available for withdrawal. The app is available for both IOS devices and Android devices. We hope you have benefited from this article!

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