This time, duitanda.com will explain in detail “What is a personal loan?”.This includes how to make a loan and how to repay the loan from lenders such as banks and approved borrowers in Malaysia.
WHAT IS A PERSONAL LOAN? BANKING AND LICENSED LOANS IN MALAYSIA
Am I eligible for a personal loan? What is a personal loan?
Most banks require you to be a Malaysian citizen or permanent resident, aged 21 and over (but not over 60) and earning a gross monthly income of at least RM 3000 or more.
Proof of identity, proof of income, and a residential address must also be submitted for approval.
The bank will also examine your credit rating before approving or rejecting a loan application.
How do I repay my loan? What is a personal loan?
The monthly installments will be repaid in a fixed monthly payment. Refunds are usually made by post, online, through an ATM or at a bank branch.
If your salary is paid by the same bank, then your loan repayment can be automatically debited from your account directly.
How much can I lend?
Most banks and lenders in Malaysia will provide loans from RM1,000 to RM400,000.
It depends on the borrower’s credit history or rating.
Some banks also set loan limits.
Most banks will give you a loan amount ranging from 6 to 10 times your current salary.
Frequently asked questions about the personal loan
WHAT IS A PERSONAL LOAN?
To answer the question of what a personal loan is, we can define it as follows:
A personal loan is a type of loan issued by banks and financial institutions.
It is the best way when you need money to finance personal expenses such as: –
[renovating your home, vacations, education, business, medical bills, or whatever.]
A personal loan gives you the financial flexibility to use the funds according to your needs and requirements.
As the name suggests, a personal loan is a type of unsecured loan that helps meet your current financial needs.
You usually don’t need to pledge collateral or collateral to apply for a personal loan.
When should I make a personal loan?
You can make a personal loan for the following needs: –
Examples include paying for weddings, renovations, and medical bills that are not covered by insurance.
Some people prefer to take out a personal loan rather than using a credit card because the monthly payments are fixed and easier to plan.
For other purposes such as car payments, tuition, and housing, it is usually cheaper to use some loans for this purpose.
Ask your bank about auto loans, student loans, home loans, etc.
It is advisable to only use a personal loan when you are unable to find a loan that meets your needs.
Am I eligible for a personal loan?
The banking conditions are generally as follows: –
- Malaysian citizen or permanent resident
2. 21 years of age and over (but not over 60)
- Gross monthly income of at least RM3,000 or more.
Proof of identity, income, and residential address must also be presented to the bank.
The bank will also examine your credit rating before approving or rejecting a loan application.
What is the difference between secured and unsecured loans?
A secured loan means that there are several forms of collateral (guarantees) made to the bank. Examples of guarantees include property, cars, equity portfolios, gold assets, etc. The value of the collateral must exceed the loan amount.
If you do not repay the loan as agreed, the bank is entitled to take the collateral. Unsecured loans do not require collateral.
There is no collateral beyond the signed loan agreement (which is a legally binding contract).
Generally, unsecured loans have higher interest rates than secured loans.
What is a personal loan / Loan insurance?
Loan insurance, sometimes referred to as “payment protection insurance,” is insurance that helps protect loan holders from not repaying the loan.
It provides financial support due to disability, unemployment, or other debilitating factors that prevent borrowers from repaying their loans immediately.
WHAT IS A PERSONAL LOAN? What are the late fees?
These are fees charged for latecomers. Usually, a period of 60 days, from the stated refund date, where the late charge does note will not be charged.
To avoid these penalties, ask the bank or lender if they have a prepayment policy.
What is a personal loan?
A personal loan is a loan where the principal (loan amount) and interest (loan interest) are repaid in a small fixed amount at regular intervals.
Payment is usually made monthly for a specified period.
What is the annual membership fee?
Annual fees are also known as maintenance fees billed annually by your credit card provider. Some banks release an annual fee depending on the card and the promotion.
What is loan insurance? What is a personal loan?
Loan insurance, sometimes referred to as “payment protection insurance,” is insurance that helps protect loan holders against repayment of loans.
It provides financial support due to disability, unemployment, or other debilitating factors that prevent borrowers from repaying their loans immediately.
What is the minimum payment? What is a personal loan?
The minimum payment is the amount you have to pay each month to avoid having a bad credit score.
It is calculated based on your outstanding balance and will appear on your monthly statement.
The unpaid balance or any balance over your loan limit are other things that will affect your minimum payment.
If you pay the minimum amount on your monthly invoice, interest remains to be charged on this unpaid amount.
However, if you do not pay the minimum fee, you will be charged a late fee, in addition to interest on the outstanding balance.