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With the increasingly rapid development of properties such as apartments, the presence of financing facilities such as Apartment Ownership Credit (KPA) is the right solution for purchasing an apartment unit.
But what exactly is a KPA, and how do you apply for one? Here, we'll learn more about KPA, ]understand its definition, the requirements, to a step-by-step guide to applying.
What is Apartment Ownership Credit?
Kredit Pemilikan Apartemen (KPA), or Apartment Ownership Credit, is a credit facility provided by a bank or financial institution to individuals to finance the purchase of an apartment. Essentially, a KPA operates similarly to a KPR (Home Ownership Credit), but with a different property ownership objective.
If KPR is intended for purchasing a house, then KPA is specifically intended for apartment units, both those that are ready to be occupied and those that are still under construction (pre-launch).
With a mortgage (KPA), you can own an apartment and pay off the price in monthly instalments over a long period, typically between 5 and 25 years, without having to pay cash upfront. The bank will cover the payments to the developer or seller, and the apartment unit will serve as collateral until all instalments are paid off.
This convenience allows people with a fixed income to purchase apartments in strategic locations without having to wait for decades to accumulate savings.
KPA is highly sought after, especially by young professionals and small families seeking practical, centrally located housing. The apartments offer a modern lifestyle with comprehensive amenities such as a swimming pool, fitness centre, 24-hour security, and easy access to various public facilities.
Benefits of Taking Apartment Ownership Credit
Find out what you can get with an Apartment KPA:
1. Lower Down Payment
With a mortgage, you don't need to put up all the cash to purchase an apartment. You simply pay a down payment (DP), which typically ranges from 10% to 30% of the apartment price. The bank will pay the remainder, and you can pay in instalments according to your needs and affordability.
2. Long Instalment Period
KPA offers flexible repayment terms, even up to decades. This makes monthly instalments more affordable, easier, and adaptable to your financial capabilities.
3. Guaranteed Legality and Security
When applying for a mortgage (KPA), the bank will verify the legality of the apartment you intend to purchase. This ensures that the property is not a scam and that all ownership documents are valid.
In addition, KPA is usually also equipped with property insurance and life insurance, providing extra protection for you and your investment.
4. Investment Opportunities
An apartment you purchase through a mortgage can be a profitable investment. You can rent out the unit to generate passive income. This rental income can even help cover your monthly mortgage payments.
In addition, the value of apartment properties tends to increase from year to year, so you can make a profit when you sell them in the future.
5. Immediately Occupy the Unit
Once the down payment is paid and the administrative process is complete, you can move into the apartment immediately without having to wait for the full instalments to be paid off. This is especially beneficial for those who need a place to live immediately.
Overall, KPA is an effective solution for those of you who want to own a dream apartment in the city centre without needing a large initial investment.
General Requirements for KPA Application
Before proceeding to the application stage, it's important to understand the requirements. While each bank has slightly different policies, there are some general requirements you must meet.
Personal Requirements
- Prospective debtors must be Indonesian citizens domiciled in Indonesia.
- Generally, the minimum age is 21 years at the time of application and a maximum of 55-65 years at the time the loan is paid off (depending on bank policy and employment status).
- You must have a clear employment status.
- Have worked for at least 1-2 years in the current company (for permanent employees) or 2-3 years in total (for contract employees).
- The business has been running for at least 2-3 years and has clear financial reports.
- Have a steady monthly income that is sufficient to pay instalments and meet daily living needs.
Document Requirements
Identity Document
- Photocopy of the applicant's and spouse's National Identity Card (KTP) (if married).
- Photocopy of the Family Card (Kartu Keluarga - KK).
- Photocopy of Marriage Certificate (for those who are married) or Divorce Certificate (for those who have been married).
- Photocopy of personal Taxpayer Identification Number (NPWP).
Financial Documents
- Last 3 months pay slip (for employees).
- Bank statement/savings statement for the last 3-6 months.
- Income Statement from the company (optional, but highly recommended).
- Business financial reports and SIUP/TDP (for self-employed).
Property Documents
- Photocopy of the Sales Purchase Agreement (PPJB) from the developer.
- Apartment unit brochure or site plan.
- A photocopy of the apartment ownership certificate, namely the Certificate of Ownership of a Strata Title Unit (SHMSRS). If the apartment is still under construction, the main ownership document from the developer will be submitted.
How to Apply for an Apartment Mortgage Loan in 2025
Here is a guide that you can follow to make applying for a KPA easier:
1. Make a comparison between KPA products
Before deciding to apply for a KPA, there are several important things to consider:
Compare mortgage products from various banks. Pay attention to interest rates (both fixed and floating), provision fees, administration fees, and instalment plans offered.
Decide which apartment you want to buy. Consider the location, amenities, price, and especially the developer's reputation. Ensure the developer has a good track record and that the project's legal standing is clear.
Run a mortgage instalment simulation. Ensure your monthly instalments don't exceed 30-40% of your total income. Don't forget to factor in other costs, such as maintenance fees (IPL/service charges) and utilities.
2. Prepare the Required Documents
After successfully selecting a bank and apartment, gathering all the necessary documents is the next crucial step. Ensure all documents, from identity documents and financial documents to property documents, are complete and photocopied. Complete documentation will significantly expedite the bank's verification process.
3. Submit a KPA Application
Visit your chosen bank or a partner apartment marketing office. Complete the mortgage application form and submit all the necessary documents.
At this stage, you'll also be asked to pay a down payment (DP) to the developer. Typically, the bank will require proof of this down payment.
4. Bank Verification
The bank's credit analysis team will verify your data. This process includes:
- Check the completeness and validity of all documents you submit.
- Assess your financial situation, including your debt ratio and repayment capacity. The bank will review your credit history in the Financial Services Authority's (OJK) Financial Information Services System (SLIK).
- The bank's appraisal team will assess the apartment unit you intend to purchase. They will ensure that the property's value aligns with the loan application and that its legality is clear.
- A bank officer will usually contact you for a short interview, either by telephone or in person.
5. Approval and Credit Agreement
If your application is approved, the bank will issue a Credit Approval Confirmation Letter (SP3K) or an offering letter. These documents detail the approved loan, including the loan amount, interest rate, and term.
Carefully read every point in this letter. If you agree, you will sign the credit agreement in front of a notary appointed by the bank.
6. Disbursement of Funds
After the loan agreement is signed, the bank will disburse the loan funds. These funds will be transferred directly to the developer's or apartment seller's account. Afterwards, you officially become the owner of the apartment unit and will begin repayments according to the agreed-upon schedule. Don't forget to arrange the handover of keys and other documents from the developer.
Tips for a Successful Apartment Loan Approval
- Ensure there are no outstanding payments on other credit products, such as credit cards or online loans. A clean credit history is key to bank approval.
- A larger down payment can increase the chances of your application being approved and reduce the burden of monthly instalments.
- Buy an apartment from a reputable developer with proven projects through Lets Move Group. This will minimise legal risks and ensure the quality of the building.
Apartment Ownership Credit (KPA) is an effective financial bridge to owning your dream home in the city centre. Understanding the definition, requirements, and application process will simplify the process.
Make sure you have prepared everything thoroughly, from your financial situation to the completeness of your documents, so that your mortgage application runs smoothly and you can quickly occupy your dream apartment unit.
Ready to experience comfortable and modern living? Our experienced consultants will guide you through the mortgage (KPA) requirements in Indonesia. Our team is ready to assist you through every stage of your apartment loan application. Contact Lets Move Group today!
