1. What is the House Loan Payment Formula?

The house loan payment formula (PMT) calculates the fixed monthly payment required to repay a loan over a specified term. It's the standard formula used by banks in Malaysia for fixed-rate housing loans.

2. How Does the Calculator Work?

The calculator uses the PMT formula:

Where:

• \( P \) — Principal loan amount (MYR)
• \( r \) — Monthly interest rate (annual rate divided by 12)
• \( n \) — Total number of payments (loan term in years × 12)
• \( PMT \) — Monthly payment amount (MYR)

Explanation: The formula accounts for compound interest over the loan term, ensuring each payment covers both principal and interest.

3. Importance of Loan Calculation

Details: Understanding your monthly payment helps with financial planning, comparing loan offers, and determining affordability before committing to a property purchase.

4. Using the Calculator

Tips: Enter the principal amount in MYR, annual interest rate (without % sign), and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical home loan term in Malaysia?
A: Most housing loans in Malaysia have terms between 20-35 years, though shorter terms are available.

Q2: How is interest calculated in Malaysia?
A: Malaysian home loans typically use reducing balance interest, calculated monthly on the outstanding principal.

Q3: What other costs should I consider?
A: Remember to factor in legal fees, stamp duty, valuation fees, and MRTA/MLTA insurance when budgeting.

Q4: Can I get a 100% home loan in Malaysia?
A: Most banks finance up to 90% of property value, with some offering 95% for first-time homebuyers under certain schemes.

Q5: What's the difference between conventional and Islamic loans?
A: Islamic home financing uses Sharia-compliant concepts like diminishing partnership (Musharakah Mutanaqisah) rather than interest.