Noh explained today however that his proposal for housing developers to offer loans to house buyers was based on the existing provisions under the Moneylenders Act 1951's amended 2011 version, which falls under the purview of his ministry. "My ministry has been asked to review and improve this policy especially from the following aspects: "The effectiveness of the policy in helping the public pay for house purchases, interest rates and repayment period in order to not burden the public, "Guidelines that are clear and easily understood by both the companies holding the Money Lending licence and also the borrowers," the Urban Wellbeing, Housing and Local Government minister said in a statement after explaining his proposal to the Cabinet today. He also said that his ministry will at the same time take proactive action to look at the overall effectiveness of the credit facilities under the same law to avoid misuse by "irresponsible" licence holders. Deputy Prime Minister Datuk Seri Ahmad Zahid Hamidi said last week that the Cabinet was not informed of Noh's proposal and the latter has been directed to brief his colleagues there. Noh proposed last week that eligible property developers be allowed to apply for moneylending licences to allow buyers to finance their home purchases. The licence was proposed to be issued by Noh’s ministry under the Moneylenders Act 1951 and Pawnbrokers Act 1972, with loans under the scheme subject to an interest rate of up to 12 per cent (with collateral) or up to 18 per cent (without collateral). Critics said the move could trigger a debt bubble as developers had no way of vetting risky buyers. But the Real Estate and Housing Developers’ Association Malaysia (Rehda) clarified today that property developers will only lend money to buyers as a "bridge” for down payment on their home purchases and not as a full loan as speculated. Its president Datuk Seri FD Iskandar asserted that a developer credit scheme will help buyers cover at least half the down payment because most bank loans today will only cover 80 per cent of the house price compared to 90 per cent previously. He also sought to allay concerns that the initiative could create a debt bubble, saying only major developers with a healthy balance sheet will be allowed to give out loans. Rehda claimed the proposal was made because Bank Negara Malaysia made it difficult for new buyers to get housing loans while also decreasing the loan-to-value ratio, which it said was keeping low-income earners out of the property market. According to its survey on the property market for the first half of this year, loan rejection remains the number one reason behind the decrease in house sales.