Buying a resale house with a KPR (Kredit Pemilikan Rumah, an Indonesian bank mortgage) feels different from buying a new one in a housing estate. There is no developer with a bank partnership preparing the paperwork for you. There is you, a private seller, the bank and a notary, and all of you have to move together.

The order of steps matters. Money and the certificate have to change hands at the right moment, so nobody hands something over without security.

This guide is for buyers of a resale house who will use a mortgage, especially first-timers.

How it differs from a developer mortgage

With a new house, the developer usually already works with several banks. The project documents are prepared in one go, and the first agreement is made with the developer.

With a resale house, everything is handled deal by deal:

  • The certificate is in the seller’s name, and is sometimes held by another bank because the seller still has a mortgage too.
  • The house is valued individually by the bank’s appraiser, including its condition after years of use.
  • The deed of sale (AJB, Akta Jual Beli) is signed with the seller before a PPAT (Pejabat Pembuat Akta Tanah, the official land deed maker), usually on the same day as the credit agreement.
  • The bank pays the loan to the seller, not to you.

If you’re still weighing the two, the comparison is in choosing between a new and a secondhand house.

The steps from booking to signing

The flow can vary a little between banks, but it generally runs like this:

  1. Inspect and agree the price. Check the house carefully with a checklist for inspecting a secondhand house, then agree on the price and what’s included.
  2. Put an agreement with the seller in writing. It should cover the price, the booking deposit (tanda jadi) and down payment, the deadline for the loan process, who pays which costs, and what happens if the loan is rejected or comes in short.
  3. Apply for the KPR. Hand in your personal documents and copies of the house documents: the certificate, the PBG (Persetujuan Bangunan Gedung, the building approval) or the older IMB (Izin Mendirikan Bangunan, the permit it replaced), and proof of PBB, the annual land and building tax.
  4. Appraisal. The bank’s appraiser visits the house. If the value comes in below the price, read what to do when the bank values the house below the price.
  5. Certificate check. The bank’s notary or PPAT checks the certificate at the Kantor Pertanahan (land office), for example whether it is blocked, pledged or in dispute.
  6. Approval letter (SP3K). The bank issues its credit approval letter with the loan amount, tenor, interest rate and conditions. Read it carefully before you accept it.
  7. Taxes. The seller pays final income tax (PPh) of 2.5 percent of the gross sale value, and you pay BPHTB (Bea Perolehan Hak atas Tanah dan Bangunan, the buyer’s transfer duty) under the local regulation.
  8. Credit agreement and AJB. Both are usually signed on the same day, along with the documents that register the bank’s lien (Hak Tanggungan).
  9. Disbursement and title transfer. The bank pays the seller under the conditions in the SP3K. The certificate is then transferred into your name, the lien is registered, and the bank keeps the certificate until the loan is paid off.

The deadline in step two is often underestimated. The time from application to signing depends on how complete your file is and how busy the bank is, so ask the bank for an estimate before you write a date into the agreement.

If the seller still has a mortgage

Many resale houses go on the market before the owner has finished paying. The certificate sits with the seller’s bank as collateral, so it has to be released first.

The usual order goes like this. The seller asks their bank for a statement of the remaining debt. That debt is paid off, often straight out of your loan through an arrangement between your bank, the seller’s bank and the notary.

The seller’s bank then hands over the certificate and a letter for roya, the removal of the lien at the land office. Only then come the AJB and the new lien for your bank.

Don’t give the seller money to pass on to their bank without a written arrangement. The payoff should go straight to the seller’s bank. The seller’s side is covered in how to sell a house that’s still under mortgage.

If your bank happens to be the same as the seller’s, there’s another route: a change of borrower. Ask the bank which route is simpler in your case.

Paying the deposit safely

With a resale house you pay a private person, not a company. So the rules need to be tighter:

  • Keep the booking deposit modest, with a receipt and a written agreement on when it comes back if the loan isn’t approved.
  • Transfer to an account in the name of the owner on the certificate, not to a relative, a middleman or anyone else.
  • Pay the rest of the down payment at the AJB, or in a way agreed in writing before the notary or PPAT.
  • Get the seller’s spouse’s consent if the house is joint marital property. The PPAT will ask for their signature or written consent.
  • Keep every record, including transfer receipts and copies of the agreement.

A serious seller won’t object to any of this. If a seller pushes for cash up front before the documents are checked, slow down.

Documents to check before you apply

Ask for copies of these before paying a booking deposit:

  • The certificate. Make sure the owner’s name matches the seller’s ID card and the land area looks right against what’s on the ground. If it’s a Hak Guna Bangunan (HGB, a time-limited right to build), check when it expires.
  • The PBG or IMB. Compare it with the building as it stands now. Extensions without a permit can affect the bank’s valuation.
  • The PBB bill (SPPT) and payment receipts for the last few years, so no arrears pass to you.
  • The seller’s identity and status, such as the ID card (KTP), family card and marriage book. If the house was inherited, ask for the heirs’ documents.
  • Recent electricity and water bills, to confirm there are no arrears and whose name the accounts are in.

Banks generally only accept houses with a land certificate as mortgage collateral. A house on land held only on an SKT (Surat Keterangan Tanah, a village land letter that shows possession, not title), a segel or another land letter usually has to be certified first.

Costs to budget for

On top of the down payment, set aside money for:

  • Bank fees, such as the provision fee, administration and appraisal.
  • Notary and PPAT fees, for the certificate check, the AJB, the title transfer and registering the lien.
  • BPHTB as the buyer, plus PPh if you’ve agreed to share the seller’s part.
  • Life and fire insurance premiums, which banks usually require.
  • Repairs and moving, since a resale house almost always needs some work.

Amounts differ between banks, notaries and regions. Ask the bank and the notary for written estimates before you agree on a final price, and make sure your emergency fund is still there after everything is paid.

What to do next

Before paying a booking deposit, ask the seller for copies of the certificate, the PBG or IMB, and the PBB. Compare mortgage offers from several banks, then write the deadline and the exit conditions into your agreement with the seller.

If you’re looking for a resale house in Kalimantan, browse the houses listed on Vorneo, and the Vorneo team is on WhatsApp.