1. What is Car Loan Refinancing?

Car loan refinancing in Malaysia allows borrowers to replace their current auto loan with a new one, typically to get better interest rates or terms. This calculator helps estimate monthly payments for refinanced loans.

2. How EMI Calculation Works

The calculator uses the standard EMI formula:

Where:

• \( P \) — Principal loan amount (MYR)
• \( r \) — Monthly interest rate (annual rate ÷ 12 ÷ 100)
• \( n \) — Loan term in months
• \( PMT \) — Monthly EMI payment

Explanation: The formula accounts for both principal and interest components of the loan payment, with interest being front-loaded in early payments.

3. Malaysia Refinancing Rates

Current Rates: In Malaysia, refinanced car loan interest rates typically range from 2.88% to 4% per annum, depending on the bank, loan tenure, and vehicle age.

4. Using the Calculator

Tips: Enter loan amount in MYR, annual interest rate (2.88-4% typical for Malaysia), and loan term in years. The calculator will show your estimated monthly payment.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical refinancing loan term in Malaysia?
A: Most banks offer 1-9 years for refinancing, with shorter terms for older vehicles.

Q2: Are there fees for refinancing?
A: Yes, typically including processing fees (RM100-300), stamp duty (0.5% of loan), and insurance charges.

Q3: Can I refinance if my car is more than 10 years old?
A: Some banks may not refinance older vehicles, while others may offer shorter terms and higher rates.

Q4: How does refinancing affect my credit score?
A: Applying will cause a small temporary dip, but timely payments on the new loan can improve your score long-term.

Q5: Should I refinance my car loan?
A: Consider refinancing if you can get at least 0.5% lower rate, want to extend tenure to reduce payments, or need cash out from your vehicle's equity.