WITHDRAWAL OF MONEY FROM THE EMPLOYEES PROVIDENT FUND (EPF) FOR THE PURCHASE OF A HOUSE

WITHDRAWAL OF MONEY FROM THE EMPLOYEES PROVIDENT FUND (EPF) FOR THE PURCHASE OF A HOUSE

Buying a house requires the buyer to spend a lot of money especially nowadays, with the rising of the house prices.  In this regard, the Employees’ Provident Fund (EPF) allows withdrawal of Account 2 by EPF Members (“Members”) for the purpose of financing the purchase of a house.

Eligibility Requirements

1. The applicant is an EPF Member
2. The applicant has not reached the age of 55 on the application date
3. The applicant’s total savings in Account 2 is at least RM500
4. The purpose of the withdrawal is for the purchase of a residential house.

(Residential House includes bungalow/terrace/detached/apartment/ condominium/apartment/studio apartment/serviced apartment/townhouse/ SOHO or shophouse with residential unit in Malaysia)

5. The purchase of a house must be either fully financed by Member in cash or through a housing loan approved by an authorized financier such as a licensed financial institution under the Financial Services Act 2013 (Act 758) or the Islamic Services Financial Act 2013 (Act 759), the Member’s employer, Cooperative bodies/Licensed Corporation approved by the Malaysia Co-operative Societies Commission or authorized lender approved by the EPF
6. The Sale and Purchase Agreement shall not exceed three (3) years from the date of the EPF withdrawal application.

Members not Eligible to Apply

1. The purchase of land or house lots only
2. Repair, renovation or extensions to existing structure of the house
3. Loans in the form of overdrafts
4. Ownership of property not through a sale and purchase agreement
5. A third home purchase
6. Purchase of any house abroad

Category of Withdrawal

EPF withdrawals for the purchase of house are divided into two (2) categories, namely –

1. Individual withdrawal by Members; or
2. Joint Withdrawal with the Member’s spouse/family members.
   

Application & Related Documents

Members are required to go to the EPF office to verify their fingerprint.  The application for withdrawal of money shall be submitted together with the following documents:

1. Withdrawal Application Form i.e. EPF 9C Withdrawal Form (AHL) (D5)
2. Member’s Identity Card (Mykad)
3. Any identity document such as a passport (if not a Mykad holder)
4. Sale and Purchase Agreement (the date of the agreement shall not exceed three (3) years)
5. Proof of Relationship such as Birth Certificate or Marriage Certificate (joint purchase with spouse/family member such as parents or siblings)
6. Member’s bank account information (copy of bank book / copy of account statement)
7. Supporting documents as provided below & any additional documents required by the EPF –

(a)     Purchase Through Housing Loan

(i) Loan approval letter (if the date of the approval letter exceeds one (1) year, the application shall be submitted together with the Housing Loan Agreement/’Deed of Assignment’/Form 16A/ Title Grant which has been registered in the name of the Member and the same is charged to the financier.

(b)        Purchase Through Self-Financing

(i) Proof of payment not less than 20% of the price of the house

(ii) The Developer’s confirmation letter regarding the purchase in cash that includes the details of the property

(iii) Architect’s Certificate / letter of request payment that indicates the stage of construction is not less than 20% for unit under construction or Certificate of Fitness for Occupation for completed unit.

Note: If the withdrawal involves the purchase of a second house, the Member shall submit among others the Sale and Purchase Agreement between the Member and the latest owner/ Transfer Form 14A / Title Grant on the new owner or any relevant documents as proof for the disposal of the first house.

Are You Interested?

If you are interested in making an EPF withdrawal for purchase of any house, it is advisable for you to provide completed documents in order before submitting your application to any EPF branch so to ease the application process.  As such, do refer to the application checklist from the EPF website/at any nearby EPF branch.

However, EPF Members should comply with Section 58A of the EPF Act 1991 which requires Members to refund their withdrawal payment within six (6) months from the date of withdrawal in the event the payment is not for the purpose of purchasing the house/ withdrawal purpose.

Source: EPF Website

Prepared by,

Nur Hidayah Kamaruzaman

MESSRS MISYAIL OTHMAN & CO