Your maximum home loan in Malaysia is determined primarily by your Debt Service Ratio (DSR) โ the percentage of your income already committed to debt repayments. Most banks in Malaysia cap DSR at 60%โ70%. Here is how to calculate yours and estimate your maximum loan amount.
The DSR Formula
DSR = (Total Monthly Debt Repayments รท Gross Monthly Income) ร 100
Most Malaysian banks approve loans up to a DSR of 60%โ70%. Some banks go up to 80% for high-income borrowers (above RM10,000/month).
Maximum Loan by Salary (2026 Guide)
| Gross Salary | Max DSR 60% | Max New Loan | Max Property (90% LTV) |
|---|---|---|---|
| RM3,000 | RM1,800/mth | ~RM320,000 | ~RM355,000 |
| RM5,000 | RM3,000/mth | ~RM535,000 | ~RM595,000 |
| RM7,000 | RM4,200/mth | ~RM750,000 | ~RM833,000 |
| RM10,000 | RM6,000/mth | ~RM1,070,000 | ~RM1,190,000 |
| RM15,000 | RM9,000/mth | ~RM1,600,000 | ~RM1,780,000 |
Based on 4.35% rate, 35-year tenure, no existing commitments. Calculate your exact figure with our ๐ Mortgage Calculator.
Factors That Reduce Your Borrowing Power
- Existing car loan โ a RM700/month hire purchase reduces borrowing power by ~RM120,000
- Personal loan โ RM300/month reduces eligibility by ~RM55,000
- Credit card minimum payments โ banks factor in 5% of credit limit
- PTPTN student loan โ counts as a commitment even if deferred
How to Increase Your Loan Eligibility
Consider a joint application with your spouse or co-borrower to combine incomes. Settle outstanding personal loans before applying โ each RM200/month commitment freed up increases borrowing capacity by approximately RM36,000. Also, getting a salary increment or showing 3 months of consistent overtime pay helps.
Our editorial team specialises in Malaysian personal finance โ covering loans, taxation, insurance, EPF, and Islamic finance. Every article is fact-checked against Bank Negara Malaysia (BNM), LHDN, and major Malaysian bank publications. We reference our calculators (which use industry-standard formulas) to ensure consistency between our written content and tools. Learn more about our methodology โ