1. What is the Loan Payment Formula?

The loan payment formula calculates fixed monthly payments for amortizing loans. It's widely used by Malaysian banks in 2025 including Maybank, CIMB, and Public Bank for home, car, and personal loans.

2. How Does the Calculator Work?

The calculator uses the standard loan payment formula:

Where:

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

Example: For a MYR 500,000 loan at 2.88% p.a. over 30 years, the monthly payment would be MYR 2,075.80.

3. Importance of Loan Calculation

Details: Accurate loan calculations help borrowers understand affordability, compare loan offers, and plan their finances effectively in Malaysia's 2025 economic climate.

4. Using the Calculator

Tips: Enter principal in MYR, annual interest rate (e.g., 2.88 for Maybank's 2025 rate), and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What are typical interest rates in Malaysia 2025?
A: As of 2025, rates range from 2.88% p.a. for home loans to 4-9% for personal loans, varying by bank and borrower profile.

Q2: Does this include Malaysia's stamp duty or other fees?
A: No, this calculates principal and interest only. Additional costs like stamp duty (0.5% of loan amount) are excluded.

Q3: How does BNM's OPR affect these calculations?
A: The Overnight Policy Rate influences bank lending rates. If BNM changes OPR, banks typically adjust rates within 1-2 months.

Q4: Are there Islamic loan alternatives?
A: Yes, Islamic banks use profit rates instead of interest, but payment calculations follow similar principles with different terminology.

Q5: Can I calculate loans with variable rates?
A: This calculator assumes fixed rates. For variable rates, payments may change when rates adjust (typically every 3-12 months).