Housing Loan & Loan Agreement Legal Fees in Malaysia
Bidang Amalan
Perbankan & Pembiayaan
Legal fees for a housing loan in Malaysia are charged on the loan agreement (and charge) under the Solicitors' Remuneration Order 2023: 1.25% on the first RM500,000 of the loan amount and 1.0% on the balance up to RM7.5 million, plus 8% SST. This is charged separately from the SPA and transfer fees, and it is calculated on the loan amount — not the property price. You also pay 0.5% stamp duty on the loan agreement, subject to any remissions in force.
What are housing loan legal fees?
When you finance a property, your lawyer prepares the loan/facility agreement and registers a charge (or assignment) over the property in the bank's favour. That work is priced on the loan amount using the same statutory SRO 2023 scale that applies to the sale and transfer, so the rate is fixed across firms.
Housing loan legal fee table
Loan amount | Loan agreement legal fee (SRO 2023) | With 8% SST |
|---|---|---|
RM300,000 | RM3,750 | RM4,050 |
RM450,000 | RM5,625 | RM6,075 |
RM500,000 | RM6,250 | RM6,750 |
RM700,000 | RM8,250 | RM8,910 |
RM900,000 | RM10,250 | RM11,070 |
SRO 2023 scale: 1.25% first RM500,000 (min RM500), then 1.0% on the balance to RM7.5 million. Minimum RM500. 8% SST applies. The fee is on the loan amount; the SPA/transfer fee is calculated separately on the property price — see our guide to legal fees for buying and selling a house.
Stamp duty on the loan agreement
Stamp duty on a loan/financing agreement is 0.5% of the loan amount under the Stamp Act 1949. Budget-linked remissions sometimes reduce this for residential financing under specific schemes, and LPPSA (public-sector) financing documents are stamp-duty exempt — confirm the current position for your case. For the transfer side, see our guide to stamp duty when buying a house.
Are loan fees separate from SPA fees?
Yes. A financed purchase usually involves two sets of legal fees: the SPA/transfer (on the price) and the loan agreement (on the loan amount). Many buyers use the same firm for both — a conveyancing lawyer can handle the whole transaction — which is convenient and can reduce disbursements.
What about refinancing?
Refinancing replaces your existing loan with a new one. Legally it involves a new loan agreement and charge (fresh SRO fee on the new loan amount) plus discharging the existing charge. So you should budget for loan legal fees again, plus the discharge (redemption) cost.
Frequently Asked Questions
How much are legal fees for a housing loan in Malaysia?
They follow the SRO 2023 scale on the loan amount — 1.25% on the first RM500,000, then 1.0% — plus 8% SST. For a RM450,000 loan that is about RM5,625 before SST.
Is stamp duty payable on the loan agreement?
Yes, 0.5% of the loan amount, unless a remission or exemption applies (for example, LPPSA financing documents are exempt).
Do I pay legal fees again when refinancing?
Yes — refinancing creates a new loan agreement and charge, so a fresh SRO fee applies on the new loan amount, plus the cost of discharging the old charge.
Can one lawyer handle both the SPA and the loan?
Usually yes. Using the same conveyancing firm for the purchase and the loan is common and keeps the transaction coordinated.
Need a clear quote for your loan documentation?
At ASCOLAW (Tetuan Akmal Saufi & Co), our lawyers handle loan agreements, charges and refinancing for bank and LPPSA financing. Start with a short consultation for an itemised fee estimate. Get in touch with our team here.
This article is for general information only and does not constitute legal advice. Every property transaction is unique. Please obtain specific advice from a licensed lawyer before acting on any part of it.
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Penulis
AKMAL SAUFI MOHAMED KHALED
Managing Partner & Founder