1. What is Car Loan Eligibility?

This calculator determines how much you can borrow for a car in Malaysia based on your affordable monthly payment, current interest rates, and loan term. Banks typically allow financing up to 90% of the car's value for new cars.

2. How Does the Calculator Work?

The calculator uses the present value of annuity formula:

Where:

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

3. Malaysian Car Loan Guidelines

Details: In Malaysia, banks typically:

• Offer rates between 2.88% to 4% p.a. (2023 rates)
• Require minimum income of MYR 2,000/month
• Limit loan terms to 9 years maximum
• Recommend car payments not exceed 30% of monthly income

4. Using the Calculator

Tips: Enter what you can comfortably pay monthly, current interest rates (2.88-4%), desired loan term (1-9 years), and your monthly income. The calculator shows the maximum car price you can consider.

5. Frequently Asked Questions (FAQ)

Q1: What documents are needed for a car loan in Malaysia?
A: Typically need IC, 3 months payslips, EPF statements, bank statements, and vehicle quotation.

Q2: Can foreigners get car loans in Malaysia?
A: Yes, but requirements are stricter (higher income threshold, larger down payment).

Q3: How is interest calculated?
A: Most banks use flat interest rates, but this calculator uses reducing balance for accuracy.

Q4: What affects loan approval?
A: Credit score, debt-to-income ratio, employment history, and vehicle age/make.

Q5: Is there a penalty for early settlement?
A: Most banks charge 2-3% of the outstanding amount for early full settlement.