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Buying Property in Malaysia as a Foreigner

In this post, I’ll share my journey buying property in Malaysia as a foreigner. Hopefully this serves as a useful reference material for anyone trying to navigate the process.

Background

Although the Malaysian real estate market isn’t great in terms of asset value appreciation, there were a few reasons that influenced me to buy a property in Malaysia:

In terms of the purchase itself, (1) I bought a luxury condominium, (2) it’s a new development expected to be completed in Q3 of 2025 and (3) it’s located in the capital, Kuala Lumpur. I managed the entire purchase completely via WhatsApp from the U.S.

Process Overview

Someone in my family had recently purchased a condo in a new development and recommended me to go check it out. After touring the showroom, I asked the developer’s team to send me the full cost breakdown and timeline for development. After a bit of due diligence, I asked them to introduce me to a few banks, since the purchase would only make sense if I could secure a loan.

They put me in touch with three banks via WhatsApp: HSBC, Maybank, and UOB. As an aside, since doing business via WhatsApp may seem strange to foreigners, specifically to Westerners, when a professional reaches out to you, they’ll typically send you an image of their business card, as “validation” of who they are.

They gave me a general overview of the process and asked me for a bunch of standard financial documents (W-2, bank balances, asset balances, etc.) to see if I qualified for a loan. I provided all three banks with the information that they requested, and within two weeks, they all got back to me.

Maybank disqualified me out right. From talking to my network, it seems that they’re the most risk averse provider, which makes sense, as they’re not as global as other banks.

HSBC was willing to lend me 60%, but they would require me to sign up for an HSBC premier account. But this was a turn off for me because it would require me to park a large amount of capital in an HSBC account at zero percent interest.

UOB was willing to lend me 50% and didn’t require anything annoying like HSBC did. [1]

The interest rate from HSBC and UOB were roughly the same. The way it works in Malaysia is they’ll charge you a premium on the Standardised Base Rate (SBR), which is set by the government. Typically, for a 30 year loan, the premium is around 1.5% to 2%, which brings your total interest rate to 4.5% to 5%. The SBR is variable but the premium is fixed.

It was a no brainer to choose UOB, so I did. They immediately reached out to the developer to get me a fully fleshed out payment schedule.

The payment schedule listed out metadata about the purchase, like the property’s sale price, rebate amounts, seller, buyer, etc. But more importantly, it contained a table that broke down the purchase into stages, listed the corresponding amount due at each stage (since this was a new development) and the parties responsible for each payment. I would fork up the first 50% and the bank would handle the latter 50%.

A week after that, via their partnered law firm, they couriered me: (1) the formal loan offer, (2) the SPA (Sellers Purchase Agreement), and (3) a few other legal documents via DHL. The formal loan offer was a simple contract that confirmed the loan’s amount, its interest rate and general operating terms and conditions. The SPA, on the other hand, was a massive stack of documents that had their full terms and conditions. The other legal documents had to do with the bank being able to act on my behalf, etc., which I won’t cover since they’re mostly related to working with a law firm.

After ripping through all of the documents, I had to schedule an appointment [2] with the Malaysian embassy, as they would have to verify that I actually signed the agreements. The actual signing was fairly simple. They witnessed me sign the agreements and then notarized it by stamping wherever applicable [3]. I then couriered the signed documents back to the bank and within a week, they confirmed the loan issuance, set me up with their online portal, and issued me a debit card.

With the loan secured, I just had to wait for the developer to start issuing me invoices for my portion of payments due. This part was a bit tricky because I had to figure out how to pay these invoices [4]. There were a few methods I experimented with:

  1. Wiring money from my US bank account to my Malaysian bank account using SWIFT and then sending a domestic transfer to the developer. The reason I wanted to explore transferring money to my account first instead of wiring the developer directly is because it would generally give me more flexibility over my funds. But from the get go, I didn’t like this method because sending money via the traditional banking system sucks massively. (1) You have to pay your US bank a fixed fee to process the wire, (2) you don’t know the final amount you’ll receive at the time of the wire, meaning you have to send more than you’d like, and (3) you have to wait for a very long time for the funds to be confirmed (could be a week plus, easily).
  2. The next method I tried was an iteration of the first, which was to send money to my Malaysian bank account using Wise. I heard of Wise through Twitter and after looking into it, felt that it addressed all of the pain points I had with the bank. They charged relatively low fees, I could send exact amounts, and funds transferred quickly. I asked the bank if it was okay to use Wise to send money into my account, and they told me that I couldn’t send more than $10,000.00 at any one time, which sucks hard. But for learning’s sake, I still wanted to do a test run. So, I used Wise to send $9000.00 RM and low and behold, I got my money near instantly! I haven’t looked too much into Wise’s business model, but I surmise that they’re likely raising capital in the countries they do business in, in local currency, and then leveraging that country’s electronic payment system to transfer funds at a very low / zero cost, and providing a return to the investors via the service fee they charge. In this way, they’re able to get you funds near instantly and give you predictable pricing. A really, really smart and useful product. But this method still sucked because of the $10,000.00 limit I mentioned earlier. Basically, in Malaysia, if you use their electronic payment system (DuitNow) to send money—specifically to a foreign bank account—you’re limited to receiving and sending a maximum of $10,000 RM a day. Which is ridiculous! For example, if I had to make a $100,00.00 RM payment, I would have to send and receive 10 wires of $10,000.00 RM in my local account and then execute 10 domestic wires of $10,000.00 RM, which could take an entire month.
  3. The method I landed on was to send money directly to the developer via Wise. This method was by far the best. Since I used Wise, I could send the developer the exact amount I wanted to and close to the time the amount was due (instead of weeks in advance via the SWIFT network). Since they were a local business, they didn’t have a cap on the amount I could transfer into their accounts.

I essentially paid my entire down payment through Wise. Every time I sent a payment, I would confirm with the developer’s credit control team and ensured I received a statement of account for my own records. That’s pretty much it. Once I finished my share of the payments, the bank activated my credit facility and took care of the rest.

Costs

  1. I had my MOT fees (Memorandum Of Transfer, a document that the buyer signs to transfer ownership from the seller to the buyer) covered by the developer, which scales up to 4%, based on the value of the property [5]. I’m not sure if this is a cost that is commonly covered by the developer and then sold as a “benefit” or if this was an actual benefit. But if it’s not covered by the developer, you have to cover the cost.
  2. I had the legal fees waived as well.
  3. Courier fees to ship the documents from and to the bank.
  4. The bank will require that you take out an insurance policy on the loan (MRTA insurance). For me, they told me who the insurance vendor would be and the cost. But they would handle the purchase and funding of it on my behalf.
  5. Upon completion of the property, I will have to pay fire insurance separately.

[1] Malaysian banks typically only provide loans of up to 60% for foreigners, whereas locals could borrow up to 90%. Which makes sense, providing a mortgage to a foreign buyer is much riskier as they have less recourse for getting their money back.

[2] I’m based in NYC, so I had to go to the Malaysian embassy there. I scheduled an appointment by emailing [email protected].

[3] I originally wanted to sign all of the documents electronically, but e-signatures weren’t acceptable by the bank.

[4]There’s no reason to really ask your US or local banking partner for help here, as they have a conflict of interest. Trust me, I flipped that rock to make sure. Banks want you to send money through the traditional banking systems, because they’ll make a ton off fixed fees and by giving you shitty exchange rates.

[5] This is also called the “Stamp Duty.”