You earn a steady salary. You can handle the monthly loan payments. But one wall stands in your way: the down payment.
For most first homes, the bank asks you to pay 10% of the price in cash, upfront. On a RM400,000 house, that is RM40,000. Add legal fees and other costs, and you may need RM50,000 or more before you even hold the keys.
Saving that much cash, while you pay rent and face rising prices, can feel impossible. This is the number one reason many Malaysians who can afford a home still cannot buy one.
Here is the good news. There is now a government-backed way to buy your first home with almost zero cash upfront. It is called the First Home Mortgage Guarantee Programme, or First Home MGP for short. This guide explains how it works, in plain language.
TL;DR
- First Home MGP helps eligible B40 and M40 buyers get up to 110% home financing, so you can buy with little or no down payment
- It is run by Cagamas SRP Berhad, a government-linked company, and it charges you no fee
- The 110% covers the full house price (for homes up to RM1 million), plus the extra costs like legal fees and insurance (for homes under RM500,000)
- Your household income must be within the limit (up to RM15,000 a month), and it must be your first home
- The bank still checks that you can afford the monthly payments. This is easier access to a loan, not free money
A Comprehensive Guide On Buying Your First Home with Zero Deposit
- TL;DR
- First, a Quick Word Guide
- What Is the First Home MGP?
- The “110% Financing” Magic
- Are You Eligible? The Simple Checklist
- What Homes Can You Buy?
- Bonus: You Could Win RM5,000 Right Now [Limited time]
- 3 Pro-Tips to Save Even More
- How to Apply, Step by Step
- Frequently Asked Questions
- Your First Home Is Closer Than You Think
First, a Quick Word Guide
This topic comes with a few big words. Here is what they mean, in simple terms. Keep this handy as you read.
- B40 and M40: income groups. B40 is the bottom 40% of earners, M40 is the middle 40%. Together, most Malaysian families.
- Down payment: the cash you pay upfront when you buy a home, usually 10% of the price. The bank lends you the rest.
- Financing (or loan margin): how much the bank lends you compared to the price. “110% financing” means the bank lends you the full price and a bit more for costs.
- Guarantor: someone who promises the bank, “if this person cannot pay, I will help cover the loss.” A bit like a parent backing a child’s rental.
- DSR (Debt Service Ratio): how much of your monthly income already goes to paying debts. Banks check this to see if you can afford a new loan.
- Stamp duty: a government tax you pay on legal documents when you buy property.
- Sub-sale: a home someone already owns and is reselling. Not brand new from a developer.
What Is the First Home MGP?
Here is the most important thing to understand. First Home MGP is a guarantee, not a loan.
Cagamas does not give you the money. Your bank still gives you the home loan, just like normal. What Cagamas does is act as your guarantor.
Remember the word guide: a guarantor promises the bank that if you cannot pay, they will help cover part of the loss. So Cagamas stands behind you.
Why does this matter? Because when a bank sees less risk, it is willing to lend you the full price of the house, without asking for a big down payment first. The guarantee is what unlocks the door.
And the best part: Cagamas does not charge you any fee for this guarantee. It costs you nothing to be covered.
One honest point to know
Even though Cagamas backs the loan, you are still fully responsible for paying back the whole amount. The guarantee protects the bank, not your monthly duty. So borrow only what you can comfortably repay.
The “110% Financing” Magic
This is where zero down payment becomes real. Under First Home MGP, the bank can lend you up to 110% of your home’s price. Here is how that splits.
100% for the house
You can borrow the full purchase price of the property. That already removes the 10% down payment wall.
An extra 10% for your costs
If your home costs below RM500,000, you can borrow an extra 10% on top. This extra amount covers your Financing Entry Costs, or FEC. These are the fees you must pay to complete a purchase, such as:
- Legal fees for the loan documents
- Valuation fees (the bank checking the home’s worth)
- Mortgage insurance (MRTA or MRTT). This is insurance that pays off your loan if you pass away or become permanently disabled, so your family is not left with the debt.
The result
You can move into your new home with almost no cash upfront. The house is financed, and your entry costs are financed too.
For homes priced RM500,000 up to RM1 million, the bank can still lend you 100% of the price. You would then cover your own entry costs. Either way, the big down payment barrier is gone.
Are You Eligible? The Simple Checklist
First Home MGP is built for everyday Malaysians. Here is who qualifies.
- You are a Malaysian citizen.
- It is your first home. (There is one exception: buyers of PR1MA homes may qualify for a second home, but only if their first loan has been active for at least 5 years.)
- Your household income is up to RM15,000 a month. This is the cap for the B40 and M40 groups.
- You are salaried or self-employed. Both are welcome. You can also apply jointly with your spouse, as long as you are both first-time buyers.
| Good to know: each bank can set its own income rules under the scheme. Some may use a lower limit, for example RM5,000 for a single applicant or RM10,000 for a joint application. Always confirm the exact limit with the bank you choos |
See how much you might borrow
Before you shop, it helps to know your rough loan size. This free calculator gives you an estimate based on your income.
This is an estimate only. The final amount depends on the bank’s own checks and your full financial record.
What Homes Can You Buy?
The scheme has a few simple rules on the property itself.
- Price cap: up to RM1 million for 100% financing, or up to RM500,000 for the full 110% financing.
- For your own stay only. This is meant for a home you will live in, not a home you plan to rent out.
- New or sub-sale, both are fine. You can buy a new project from a developer (primary market) or a home someone already owns (sub-sale, or secondary market).
- Conventional or Islamic. There is a conventional version (First Home MGP) and an Islamic version (First Home MGP-i) that follows Shariah principles.
Not sure what your budget can buy? Read our guide to how much home loan you can get for your salary.
Bonus: You Could Win RM5,000 Right Now [Limited time]
Here is a reason to act sooner rather than later. Cagamas is running a First Home Campaign from 8 June to 31 August 2026. Forty winners will each receive RM5,000 cash.
To join, you simply need to:
- Take a home loan with a Cagamas SRP guarantee (First Home MGP or the Islamic First Home MGP-i) through a participating bank
- Buy a completed home valued at RM400,000 or more
- Accept and sign your Letter of Offer within the campaign period
The cash is a bonus gift, and it is not linked to whether your loan is approved. Because campaign details can change, check the latest terms on the Cagamas SRP website before you rely on it.
3 Pro-Tips to Save Even More
1. Stack your benefits with the stamp duty exemption
Remember, stamp duty is the government tax on your legal documents when you buy a home. Right now, first-time buyers of homes priced up to RM500,000 get a 100% stamp duty exemption on two documents: the transfer document (called the MOT, or Memorandum of Transfer, which is the paper that puts the house in your name) and the loan agreement.
This exemption runs until 31 December 2027. When you combine it with First Home MGP, your upfront cost can drop to almost nothing. That is the dream combination for a first-time buyer.
2. Watch your DSR
Even with the MGP guarantee, the bank will still check your Debt Service Ratio. As a reminder, DSR is how much of your monthly income already goes to paying debts, like a car loan, PTPTN, or credit cards.
If too much of your income is already committed, the bank may say no, because it needs to be sure you can afford the home loan on top. As a rough guide, banks like to keep your total debt payments within about 60% of your income. Check yours before you apply.
This is an estimate only. Your bank makes the final decision based on its own rules.
3. MGP vs SJKP: pick the right one for you
If you are a gig worker or self-employed without regular payslips, another scheme called SJKP may suit you better. SJKP (Syarikat Jaminan Kredit Perumahan) is a similar government guarantee. It also offers up to 100% financing, and it judges you mainly on your DSR and income record, rather than fixed payslips.
Here is a simple comparison of the main zero or low down payment options.
| Scheme | Best for | Max home price | Down payment | Main benefit |
|---|---|---|---|---|
| First Home MGP | B40 and M40 first-time buyers | RM1,000,000 | 0% | Up to 110% financing |
| SJKP | Salaried, gig, and informal workers | RM500,000 | 0% | Up to 100% financing, judged on DSR |
| PR1MA | Middle-income buyers | RM400,000 | Project deposit | Homes sold below market price |
Want the full list of help available? See our guide to first home loan schemes in Malaysia and the government housing schemes for B40 and M40.
How to Apply, Step by Step
Good news: applying is simpler than most people expect. You do not apply to Cagamas. You apply for a normal home loan at a bank, and ask for the First Home MGP guarantee. The bank arranges the guarantee for you automatically.
Here is the simple path:
- Check your numbers.
Confirm your income fits the limit, and check your DSR using the calculator above.
- Get your documents ready.
Usually your IC, payslips or proof of income, and recent bank statements.
- Apply at a participating bank
and tell them you want the First Home MGP. Banks that take part include Maybank, CIMB, Public Bank, RHB, BSN, and Bank Muamalat, among others.
- The bank does the rest.
It processes your loan and the MGP guarantee together.
New to the whole process? Follow our step-by-step guide to buying a house in Malaysia, and learn about the hidden fees first-time buyers often miss.
Frequently Asked Questions
Yes, if you qualify. The First Home MGP lets eligible B40 and M40 first-time buyers get up to 110% financing, which can cover the full price and your entry costs. You still need to afford the monthly repayments.
The scheme targets households earning up to RM15,000 a month. Some banks apply their own limits, such as RM5,000 for a single applicant or RM10,000 for a joint application, so confirm with your chosen bank.
Cagamas does not charge you a fee for the guarantee. You still pay your normal home loan costs, such as interest, legal fees, and insurance, though the 110% option can help finance some of these for homes under RM500,000.
Both are government guarantees that reduce or remove the down payment. First Home MGP allows up to 110% financing for homes up to RM1 million. SJKP offers up to 100% financing for homes up to RM500,000 and is often a better fit for gig or self-employed workers, since it judges you mainly on your DSR.
Yes. First Home MGP is open to both salaried and self-employed applicants. If you do not have regular payslips, SJKP may be easier, as it focuses on your DSR and income record.
Yes. The scheme covers both new projects from developers and sub-sale homes bought from a previous owner, as long as the home is for your own stay and within the price cap.
Participating banks include Maybank, CIMB, Public Bank, RHB, BSN, and Bank Muamalat, among others. You apply for a home loan at the bank and ask for the First Home MGP guarantee.
Your First Home Is Closer Than You Think
For years, the down payment felt like a wall with no door. Now there is a door. With the First Home MGP, the stamp duty exemption, and schemes like SJKP, buying your first home is genuinely within reach for B40 and M40 Malaysians.
The best next step is to talk to someone who does this every day, someone who can match you to a home you can afford and walk you through the paperwork.
Ready to find a home you can actually afford?
An IQI agent can help you check which scheme fits you, find homes within your budget, and guide you from loan to keys. Friendly help, no pressure.
Talk to a local IQI agent and start your journey today.
Or start browsing now: homes for sale and new launches.
This article is for general information only and reflects IQI’s own views. It is not financial, legal, or tax advice. Scheme rules, income limits, and campaign details were accurate to the best of our knowledge at the time of writing (July 2026) and can change. Please confirm the latest terms with Cagamas SRP, your bank, or a licensed adviser before making any decision.
Continue reading:
Sources:
- Cagamas SRP: csrp.cagamas.com.my
- Housing Australia: www.housingaustralia.gov.au
- SJKP Malaysia: www.sjkp.com.my
- PR1MA Malaysia: www.pr1ma.my
- Residensi Wilayah: residensiwilayah.jwp.gov.my
- EPF Housing Withdrawal: www.kwsp.gov.my/en/w/article/epf-housing-withdrawal
- Public Bank Gateway: apply.pbebank.com/homeloan
- Hunter Galloway Assessment: www.huntergalloway.com.au/contact/
