1. What is the Car Loan Eligibility Calculator?

This calculator determines the maximum loan amount (principal) you can qualify for based on your affordable monthly payment, interest rate, and loan term. It uses standard Malaysia-style car loan calculations with typical interest rates of 2.88-4% p.a.

2. How Does the Calculator Work?

The calculator uses the loan eligibility formula:

Where:

• \( P \) — Maximum loan amount (principal, MYR)
• \( PMT \) — Affordable monthly payment (MYR)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Total number of payments (term in years × 12)

Explanation: The formula calculates the present value of an annuity (series of equal payments) considering the interest rate and loan duration.

3. Importance of Loan Eligibility Calculation

Details: Knowing your maximum loan eligibility helps in budgeting and car selection. It ensures you don't overcommit financially and helps negotiate better terms with lenders.

4. Using the Calculator

Tips: Enter your comfortable monthly payment in MYR, the annual interest rate (typically 2.88-4% in Malaysia), and loan term in years (usually 5-9 years). All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Is this calculator specific to Philippines?
A: No, this uses Malaysia-style car loan calculations, though the formula is generally applicable. Philippine rates and terms may differ.

Q2: What are typical interest rates?
A: In Malaysia, rates typically range from 2.88% to 4% p.a. for car loans, depending on credit score and loan term.

Q3: How does loan term affect eligibility?
A: Longer terms increase eligibility amount but result in higher total interest paid over the life of the loan.

Q4: What's not included in this calculation?
A: This doesn't account for down payments, insurance, or other fees that may affect total car affordability.

Q5: Should I borrow the maximum eligible amount?
A: Not necessarily. Consider your overall financial situation and leave room for unexpected expenses.