Types Of Car Loans
Types Of Car Loans Based On The Principle Of Financing
Based on the principle of financing, there are two types of car loans available for customers:
- Conventional Car Loan: A conventional car loan provides an individual with funds to purchase a car. It covers all new, used and unregistered and reconditioned cars. The margin of financing with a conventional car loan is up to 90% of the vehicles price. A conventional loan comes with a flexible repayment tenure that can be extended to 9 years.
- Islamic Car Loan: Islamic car loans are based on Shariah principles of financing. The ownership of the car is transferred to the individual once the repayment is completed. The Islamic car loans come with a high margin of financing, i.e. up to 90% to 100% of the car’s price.
Who Can Apply For A Car Loan
The eligibility criteria of a car loan are as follows:
- Individuals applying for a car loan must be at least 18 years old at the application date.
- Individuals must be Malaysian citizens.
- Any salary earning individuals, self-employed individuals, public listed companies, private limited companies, sole proprietorships, and partnerships can apply for a car loan.
- The car loans that are available for foreigners require them to be accompanied with a local guarantor.
Documents Required For A Car Loan
The set of documents required may vary from applicant to applicant. The following are the lists of documents required to be presented by the applicants:
- For Salary Earning Individual Applicants:
- Copies of both sides of NRIC.
- One copy of driving license.
- Salary slips’ copies for the last 1-6 months (depending upon the loan package).
- Bank/passbook statement for the last 1-6 months.
- Latest EA form or EPF statement.
- Employment confirmation letter.
- For Self-employed Individuals, Sole Proprietors, And Partners Of A Partnership:
- Copies of both pages of NRIC.
- One copy of driving license.
- Business registration certificate.
- Latest Borang/BE with the validated receipt of tax payment LHDN.
- Bank statement for the 3 to 6 latest months.
- A relevant business income proof document.
- For Private Limited Companies:
- Latest form 9, 13, 24, and 49.
- Bank statements for the 3-6 recent months.
- Certified true copies of Articles of Association and Memorandum.
- Profile of the company’s director
- Management’s profile.
- A copy of the Certificate of Commencement of Business.
- For Public Listed Companies:
- Latest audited annual financial statement.
- Latest form 24 and 49.
- For Foreign Applicants:
- One copy of passport.
- One copy of contract letter, or
- One copy of employment letter.