Watch out for this hidden trap before buying a house with your partner

Last Updated on August 21, 2025 by Chin Yi Xuan

Are you thinking of buying a house with your partner in Malaysia? 

If yes, watch out for this hidden trap before taking a Joint Loan:

Here’s a quiz on Joint Loan:

If you pass away, does your partner inherit your share of the home automatically?

Here’s the surprising answer:

In my Certified Financial Planner (CFP) class last week, I learned that most co-owned properties in Malaysia (including for couples) are held under Tenancy in Common.

Meaning, you and your partner will own the property equally. (👨: 50%, 👩: 50%)

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But here’s the catch:

If one of you passes away, the surviving partner does NOT automatically inherit the other’s share.

Without a will, your share will be split based on the Distribution Act 1958 (for Peninsular & Sarawak):

Example:

Let’s say when you pass away, your parents, spouse, and child are still alive. 

Your share of the property will be distributed as follow:

• 👩 Spouse → gets 1/4 
• 👶 Child → gets 1/2 
• 👵 Parents → get 1/4

Your partner may suddenly co-own the property with your parents and child.

This may lead to potential conflict in the future:

Let’s say in the near future, your partner wants to sell the house, but your parents want to keep it.

The property becomes legally stuck — creating emotional and financial strain.

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💡 The solution? Write a will – both you and your partner.

You and your partner should have a will stating who inherits their share of the property.

Writing a will can avoid complications and ensures your wishes are honoured.

TLDR:

• 🛑 Joint loan ≠ automatic inheritance 
• 📜 Write a will 
• 💬 Talk about this before buying a house with your partner

I hope this post is helpful!

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p.s. Want to learn more about will-writing? I wrote my will when I was 28 – check out my experience HERE.

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Disclaimer

Not financial advice. Do your own due diligence before making any financial decision.