1. What is Car Loan Eligibility?

The car loan eligibility calculator determines how much you can borrow based on your monthly payment capacity, interest rate, and loan term. In Malaysia, banks typically require minimum income of RM 2,000/month and keep payments below 30% of income.

2. How Does the Calculator Work?

The calculator uses the present value of annuity formula:

Where:

• \( P \) — Principal loan amount (MYR)
• \( PMT \) — Monthly payment (MYR)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Loan term in months

Explanation: The formula calculates the maximum loan amount you can get based on what you can afford to pay monthly.

3. Importance of Loan Eligibility

Details: Knowing your eligibility helps in car shopping and financial planning. Malaysian banks typically offer rates between 2.88-4% p.a. for car loans with terms from 3-9 years.

4. Using the Calculator

Tips: Enter your comfortable monthly payment (consider your other expenses), current interest rates (check bank offers), desired loan term, and your monthly income.

5. Frequently Asked Questions (FAQ)

Q1: What's the minimum income for car loans in Malaysia?
A: Most banks require minimum RM 2,000/month, but some may accept RM 1,800 for certain models.

Q2: How much of my income can go to car payments?
A: Banks typically cap at 30% of your monthly income for car loan repayments.

Q3: What affects my eligibility besides income?
A: Credit score, existing debts, employment history, and car model/age also affect approval.

Q4: Are interest rates fixed for car loans?
A: Most Malaysian car loans use fixed interest rates throughout the loan term.

Q5: Can I get 100% financing?
A: For new cars, up to 90% financing is common. Used cars typically get 70-80% financing.