Progressive Payment Schedule Malaysia: Every Stage, and the Interest You Pay
The progressive payment schedule in Malaysia is the Third Schedule of the statutory SPA: under the post-2015 Schedule H you pay 10% on signing, 65% across the construction stages and 17.5% at vacant possession, with the last 7.5% paid at handover but partly held by the developer’s lawyer. Below is every stage, the reason you will find two different sets of percentages online, how the bank releases your loan, and a worked example of the interest you actually pay during construction on a RM600,000 condo.
Short answer
Under Malaysia’s post-2015 Schedule H you pay 10% on signing the SPA, 65% across eight construction stages certified by the architect, and 25% at vacant possession (17.5%, plus 2.5% on delivery of the title and 5% held by the developer’s solicitor). Each bill is due within 30 days of written notice and late payment costs 10% a year. You pay interest only on what the bank has released.
Key numbers at a glance
| On signing the SPA (item 1) | 10%, with the booking fee counted toward it |
|---|---|
| Construction stages (item 2) | 65% in total, eight bills from foundation to roads |
| Vacant possession (item 3) | 17.5%, strata title must have been issued |
| Title and transfer (item 4) | 2.5% on delivery of the transfer and original title |
| Stakeholder sums (item 5) | 2.5% at 8 months + 2.5% at 24 months after VP |
| Time to pay each bill | 30 days from written notice with architect's certificate |
| Late payment interest | 10% a year, calculated daily |
| Which version applies | New form for projects licensed from 1 July 2015 |
Key points in 30 seconds
- Under the post-2015 Schedule H the instalments run 10 / 10 / 15 / 10 / 10 / 10 / 5 / 2.5 / 2.5 / 17.5 / 2.5 / 2.5 / 2.5 percent, totalling 100%.
- The 12.5% VP payment and 5% each for drains and roads that you often see online come from the pre-2015 form, used only for projects licensed before 1 July 2015.
- Each bill must come with an architect’s certificate; you have 30 days from the notice to pay, and late payment costs 10% a year.
- During construction you pay interest only on what has been released: about RM500 a month on a RM540,000 loan once the frame is done (assuming 4% a year), rising to a full instalment of about RM2,390.98 over 35 years.
- Bank Negara Malaysia banned developer interest-bearing schemes (DIBS) in 2013, so construction-period interest is normally the buyer’s cost.
Progressive payment schedule in Malaysia: how much at each Schedule H stage?
This is the Third Schedule of the 2015 substituted Schedule H (strata), taken from the statutory form published by REHDA and cross-checked against a developer’s published schedule. Each item 2 stage is payable within 30 days of the developer’s written notice.
| Item | Stage | Share | Cumulative |
|---|---|---|---|
| 1 | On signing the SPA | 10% | 10% |
| 2(a) | Work below ground level, including foundation | 10% | 20% |
| 2(b) | Structural framework | 15% | 35% |
| 2(c) | Walls with door and window frames in place | 10% | 45% |
| 2(d) | Roofing/ceiling, electrical wiring, plumbing (no fittings), gas piping, telecom trunking and cabling | 10% | 55% |
| 2(e) | Internal and external finishes | 10% | 65% |
| 2(f) | Sewerage works | 5% | 70% |
| 2(g) | Drains | 2.5% | 72.5% |
| 2(h) | Roads | 2.5% | 75% |
| 3 | Vacant possession, water and electricity ready, strata title issued | 17.5% | 92.5% |
| 4 | At VP, on delivery of the executed transfer and original strata title | 2.5% | 95% |
| 5 | At VP, held by developer’s solicitor as stakeholder: released 8 months after VP | 2.5% | 97.5% |
| 5 | At VP, held by developer’s solicitor as stakeholder: released 24 months after VP | 2.5% | 100% |
Notes: item 3 (17.5%) can only be billed once the strata title has been issued, unless the Controller approves otherwise under clause 28(1); item 4 waits until the developer delivers the executed transfer and the original strata title to you or your lawyer; item 5 (5%) is paid at VP but held by the developer’s solicitor as stakeholder and released in two parts, and can be used to pay for defects the developer fails to fix (see defect liability period).
Why do progressive payment percentages differ online?
There are two sets of figures because the 2015 amendment applies only to projects licensed on or after 1 July 2015. The older form still appears on some large property portals (for example a PropertyGuru guide updated in 2024) and in contracts for older projects.
| Stage | Pre-2015 | Post-2015 |
|---|---|---|
| Signing to finishes (items 1 to 2(e)) | 10 / 10 / 15 / 10 / 10 / 10 | Same |
| Sewerage | 5% | 5% |
| Drains | 5% | 2.5% |
| Roads | 5% | 2.5% |
| Vacant possession | 12.5% | 17.5% (strata title required) |
| Title-related | 2.5% (held pending subdivision approval) | 2.5% (on delivery of transfer and title) |
| Stakeholder sums | 2.5% + 2.5% | 2.5% (8 months) + 2.5% (24 months) |
| Time to pay | 21 working days | 30 days |
Some sites publish tables that add up to 100% but have obviously wrong stages (for example finishes at 2.5% and title at 10%). My rule is simple: read the Third Schedule of your own SPA, compare it with the table above, and ask your lawyer about any difference.
The usual loss here is not a bad purchase, it is a bill posted to an old address and never forwarded to the bank. On a RM600,000 condo the structural-frame stage is 15%, or RM90,000. Sixty days late at 10% a year, calculated daily, is about RM1,479, which the bank will not pay for you. Worse, the developer will set that arrears record off against any LAD you later claim.
Ask Louis directly
Send me a photo of the progress bill and the architect's certificate and I will check the stage and percentage against the Third Schedule of your own SPA.
Give me the project, your purchase price and loan amount and I will send you a free stage-by-stage payment and construction-interest budget.
Landed (Schedule G) and Build-Then-Sell (I and J) schedules
Schedule G (landed) has the same structure as H: 10% on signing, 65% across the item 2 stages (again 10 / 15 / 10 / 10 / 10 / 5 / 2.5 / 2.5), 17.5% at VP, 2.5% on delivery of the title and transfer, and 2.5% + 2.5% held as stakeholder and released 8 and 24 months after VP. Landed homes must be delivered within 24 months, so the bills come faster.
Schedules I (landed) and J (strata) are Build-Then-Sell: 10% on signing and the other 90% within 30 days of the notice of vacant possession. There are no progress bills and therefore no construction-period interest, but few projects use these forms. See Schedule G and H SPA explained.
How progress billing and loan disbursement work
- Pay the first 10% on signingUsually from your own funds (the booking fee is deducted from it); EPF Akaun Sejahtera can cover part of it, see EPF withdrawal for housing.
- The developer completes a stageIt sends a written notice with a certificate signed by its architect or engineer.
- Forward the bill to your bankSend the bill and certificate to the bank (or its lawyer). The bank checks it and pays that instalment straight to the developer.
- Pay within 30 daysLate payment costs 10% a year, calculated daily. If your loan is from the government, the developer may not charge late payment interest for the first 6 months after the SPA.
- Repeat until handoverAt VP, items 3, 4 and 5 together come to 25% for a strata unit whose title is delivered with the keys.
Interest during construction: a RM600,000 worked example
During construction the bank has released only part of the loan, and you pay interest only on that part (‘progressive interest’). Example: a RM600,000 condo with a 90% loan of RM540,000 over 35 years at an assumed 4.00% a year (for illustration only, not any bank’s quote; see OPR and SBR for how rates are set). You pay the 10% (RM60,000) on signing; the bank pays every later stage.
| Stage | Released this stage | Total released | Monthly interest |
|---|---|---|---|
| Foundation | RM60,000 | RM60,000 | RM200 |
| Framework | RM90,000 | RM150,000 | RM500 |
| Walls | RM60,000 | RM210,000 | RM700 |
| Wiring, plumbing | RM60,000 | RM270,000 | RM900 |
| Finishes | RM60,000 | RM330,000 | RM1,100 |
| Sewerage | RM30,000 | RM360,000 | RM1,200 |
| Drains | RM15,000 | RM375,000 | RM1,250 |
| Roads | RM15,000 | RM390,000 | RM1,300 |
| VP (17.5% + 2.5% + 5%) | RM150,000 | RM540,000 | RM2,390.98* |
* Once fully released, the loan moves to principal plus interest: RM540,000 over 35 years at 4.00% is about RM2,390.98 a month. The longer the build, the longer you pay interest-only instalments, often while still paying rent, so plan that cash flow with the buying-costs calculator.
Monthly interest = total released x annual rate / 12. When the frame is done, RM150,000 x 4% / 12 = RM500. Actual figures depend on your rate and the bank’s daily-rest calculation.
Preparing for the 25% vacant possession stage
For a strata unit, handover is the largest payment in the schedule: item 3 (17.5%), item 4 (2.5%) and item 5 (5%) add up to 25%. On a RM600,000 unit that is RM150,000, normally released by the bank in one go (item 5 goes into the developer’s solicitor’s stakeholder account). After this release the loan is fully drawn and you start paying principal plus interest.
- Inspect before you sign for the keys. You are deemed to take VP 30 days after the notice, and the 24-month defect liability period (DLP) starts from then. See the defect inspection checklist.
- Confirm the conditions are met. The CCC is issued, water and electricity are ready, and the strata title has been issued (or the Controller has approved otherwise). See CCC and vacant possession.
- Work out any LAD. If handover is later than 36 months (24 for landed), LAD is 10% a year of the price, counted from the booking date. See LAD and extension of time.
- Budget for handover costs. Service charge and sinking fund, utility deposits, and the stamp duty and legal fees on the transfer. See stamp duty and legal fees.
What happens to payments if construction is delayed or stops?
The strength of progressive payment is that the developer cannot bill the next stage until the work is done and certified by its architect. The weakness is that you keep paying interest on everything already released, which is the biggest cash-flow strain when a project runs late.
If work stops continuously for 6 months or more beyond the contract period, or the developer is wound up or placed in receivership, the project may be classed as abandoned and KPKT steps in. The steps for buyers are in abandoned housing projects. In the meantime, visit the site now and then and compare what you see with the stage being billed; if the two clearly do not match, ask the developer and your bank.
The DIBS ban and 'no interest during construction' offers
Under the old developer interest-bearing scheme (DIBS) the developer paid the construction-period interest, usually by building the cost into the price. In its 2013 measures Bank Negara Malaysia (BNM) stopped banks from financing DIBS purchases and required loans to be based on the net price after rebates. So construction-period interest is, in principle, the buyer’s cost today.
If you hear of a package that promises ‘nothing to pay during construction’, ask three questions: who pays the interest, is it written down, and has the price gone up to cover it? Without written answers, budget as if you will pay it.
- Check that the SPA’s Third Schedule is the post-2015 version (17.5% at VP).
- File every bill and architect’s certificate by date.
- Forward each bill to the bank or its lawyer on the day it arrives.
- Budget for construction-period interest and, if relevant, rent at the same time.
- At VP, confirm the conditions for items 3, 4 and 5 (title, transfer) are met before release.
- Diary the dates 8 and 24 months after VP and report defects before them (see CCC and vacant possession).
Related questions
How much cash do I need of my own on signing day?
The bank only funds the construction stages, so the first 10% is your own money. On a RM600,000 condo that is RM60,000, less the booking fee you already paid. What buyers underestimate is stamp duty, legal fees and disbursements, which banks generally do not lend against, so they come out of cash too. An EPF Akaun Sejahtera housing withdrawal can cover part of the down payment: see EPF withdrawal for housing.
Does the bank pay me or the developer?
The developer, directly. The money never passes through your account. Your job is to forward the developer’s written notice and architect’s certificate to the bank or its panel lawyer the day it arrives. Banks need processing time, and the 30-day clock runs from the developer’s notice, not from the day your bank receives it. A bill left unopened for two weeks means late interest charged to you, not to the bank.
Is buying under construction cheaper than buying a completed unit?
Monthly it is far lighter, but the saving is deferred, not real. On a RM540,000 loan at an assumed 4% a year, only RM150,000 is released when the frame is done, so interest is about RM500 a month. Once the loan is fully drawn you move to principal plus interest, about RM2,390.98 a month over 35 years, and during the build you are often paying rent as well. The longer the project takes, the more interest-only months you pay.
What if the stage being billed doesn't look finished on site?
Every progress bill must carry a certificate signed by the developer’s architect or engineer. Visit the site, or send someone, take dated photos and compare what you see with the stage on the bill. If they clearly do not match, ask the developer in writing and copy your bank; do not settle for a phone call. Several months with no new bill and a quiet site is a warning sign: see abandoned housing projects.
Frequently asked questions
What is the progressive payment schedule for new property in Malaysia?
Under the post-2015 Schedule H: 10% on signing, 10% foundation, 15% structural frame, 10% walls, 10% roofing, wiring and plumbing, 10% finishes, 5% sewerage, 2.5% drains, 2.5% roads, 17.5% at vacant possession, 2.5% on delivery of title, and 2.5% plus 2.5% held by the developer’s solicitor as stakeholder.
Why do some websites say 12.5% is paid at vacant possession?
That is the pre-2015 form, with 5% each for drains and roads and 12.5% at VP. After the 2015 amendment, projects licensed on or after 1 July 2015 use the new form with 17.5% at VP. The Third Schedule in your own SPA is the version that applies to you.
How many days do I have to pay a progress billing?
Under the post-2015 forms you have 30 days from receiving the developer’s written notice, which must include an architect’s or engineer’s certificate. Late payment interest is 10% a year, calculated daily. The older pre-2015 form allowed 21 working days, so check which version your SPA uses.
Who pays interest during construction?
The buyer. The bank releases the loan stage by stage and you pay interest only on the amount released. BNM banned developer interest-bearing schemes (DIBS) in 2013, so unless there is a written arrangement, set aside money for construction-period interest in your budget from the start.
When is the 5% stakeholder sum released to the developer?
The 5% is paid at vacant possession and held by the developer’s solicitor: 2.5% is released 8 months after VP and 2.5% after 24 months. If the developer fails to repair defects, the buyer may recover repair costs from these sums under the SPA.
Can I use EPF to pay the first 10%?
Yes. An EPF Akaun Sejahtera housing withdrawal can help pay the down payment, subject to conditions such as being under 55, having at least RM500 in the account and an SPA dated no more than 3 years before the application. See the EPF housing withdrawal guide for details.
Sources & verification
- REHDA Melaka — Schedule H (substituted 2015 form, Housing Development (Control and Licensing) Regulations 1989)
- REHDA Melaka — Schedule G (substituted 2015 form)
- REHDA Melaka — Schedule I (Build-Then-Sell, land and building)
- REHDA Melaka — Schedule J (Build-Then-Sell, strata)
- TAGO — Schedule of payments (current Schedule H)
- EdgeProp — New law: strata titles should come with vacant possession
- PropertyGuru — Progressive payment schedule (shows pre-2015 percentages)
- Ganzul — Impact of the 2015 Housing Development Regulations
- Johore Bar — Salient amendments, HDR (Amendment) Regulations 2015
- iProperty — BNM lending policies (net selling price, DIBS ban)
- KPKT TEDUH — Checklist: VP without strata title (Schedule H clause 28(1))
- CLKM Law — Abandoned housing projects: remedies for purchasers
Verified: 2026-09-20. This guide is general information, not legal, tax or financial advice. Rules and rates change — confirm in writing with your lawyer, bank or the relevant authority before you sign.
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Louis Koh
11 years in Malaysian property · Johor Bahru & Kuala Lumpur · English & 中文
I help local buyers and cross-border buyers from Singapore with new and subsale property. Every figure in these guides is sourced; when a rule changes, I update the page and date it.
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Send me your situation — new or subsale, budget, state, and where you are in the process — and I will tell you what to do next and what to watch for.
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Louis Koh · 11 years in Malaysian property · +60 10-906 6685 · replies 9am–10pm MYT