# Building on your own land? How the pension change could help

> Since May 2026 the Pension Act lets members pledge pension savings for a loan to build a house. For a family with a plot, that could cover the equity a construction lender asks for. The construction loans available today, how pension could fit, and the questions to put to your lender while the regulations are written.

Source: Maldives Real Estate News, published by Binga Properties. URL: https://news.binga.mv/pension-collateral-for-building-a-house
Published: 2026-10-18T14:00:00.000Z · Updated: 2026-10-18T16:13:52.994Z · Event date: 2026-10-18

Until May 2026, a pension pledge could only help you **buy** a home. The **Sixth Amendment to the Maldives Pension Act** added loans **to construct a house**. For the many Maldivian families who own land but not the money to build, that is the bigger change.

## What construction lenders ask for today

Every construction loan needs **equity**: money of your own going into the build.

| Lender | Construction loan | Equity | Rate | Term |
|---|---|---|---|---|
| **HDFC** | Home Construction | from **10%** | 11% to 11.75% (11.75% at 10% equity, 11% at 30%) | up to 25 years |
| **MFLC** | Home Loan (build, extend, improve) | **20%** | not published | 5 to 10 years |
| **Government Hiyaavehi** (through BML, MIB, HDFC) | 5% scheme for building on owned land | varies | **5%** | 25 years |

*From each lender's site as read on 18 October 2026. Hiyaavehi applications closed in May 2025.*

## Where pension could fit

If the regulations follow the purchase scheme, your pledged pension would **stand in for the equity**. On a **MVR 2 million** build at HDFC's 10% minimum, that is **MVR 200,000**. HDFC's rate also falls as equity rises (11% at 30%), so a larger pledge could also mean a **lower rate**.

That is our reading of how it would work. **The Pension Office has not yet published how much can be pledged for construction, or with which lenders.**

## What construction lenders already require

From HDFC's page:
- **the landowner as main applicant**, and co-owners as co-applicants;
- **approved drawings**, a **construction permit**, a **construction agreement** and a **full bill of quantities**;
- an **HDFC-approved contractor**;
- money paid to the builder **stage by stage**, after inspection.

A pension pledge would sit on top of these. It would not replace them.

## Questions to ask now

1. **Pension Office (1441):** when will construction pledges open, and will the age table (100% / 80% / 50%) apply?
2. **Your lender:** will it accept pledged pension as construction equity, and does that change the rate?
3. **Both:** what happens to the pledge if the build stalls or the contractor fails?

## For flat buyers

Buying a flat off plan is still the **purchase** route, which works today with five approved lenders.

**Where it stands on 18 October 2026.** The law has been in force since **21 May 2026**. In June the Pension Office said it was writing the regulations and procedures, *"expected to be completed within three months"*. As of 18 October, its news page has announced no regulations for the housing changes. Its housing page still describes **purchase loans only**, and its five approved lenders have published no pension-backed construction or renovation product. Until they do, ask the Pension Office (1441) and your lender before you plan on it.

*From the Pension Office's announcement of 10 June 2026 and its website, read on 18 October 2026. Details will be set by regulations not yet published. General information, not financial advice.*

## Sources
- pension.gov.mv/en/media/news/6th%20amendment%20to%20Pension%20Act (Pension Office, "6th Amendment to the Maldives Pension Act", 10 June 2026) (https://pension.gov.mv/en/media/news/6th%20amendment%20to%20Pension%20Act (Pension Office, "6th Amendment to the Maldives Pension Act", 10 June 2026))
- pension.gov.mv/en/housing (Pension Office, MRPS Housing Benefit, read 18 October 2026) (https://pension.gov.mv/en/housing (Pension Office, MRPS Housing Benefit, read 18 October 2026))
- hdfc.com.mv/conventional-facilities/home-construction (HDFC Home Construction, read 18 October 2026) (https://hdfc.com.mv/conventional-facilities/home-construction (HDFC Home Construction, read 18 October 2026))
- www.mib.com.mv/business-financing/project-financing (MIB, read 18 October 2026) (https://www.mib.com.mv/business-financing/project-financing (MIB, read 18 October 2026))
- edition.mv/news/47050 (The Edition, 28 December 2025) (https://edition.mv/news/47050 (The Edition, 28 December 2025))
- www.mflc.mv/business/home-loan (MFLC Home Loan, read 18 October 2026) (https://www.mflc.mv/business/home-loan (MFLC Home Loan, read 18 October 2026))

Binga Properties is a real-estate concierge; it may represent homes and developments mentioned here.