A personal loan is a type of instalment credit provided by a financial institution (bank) to a borrower (you) in a one-time cash payment. You, as a borrower, must pay back the amount plus interest either in regular or monthly instalments over the loan’s term agreement. Personal loans can be divided into secured loans (backed by collateral) and unsecured loans (no collateral required).
You can also apply for a personal loan due to other factors.
These are the types of personal loans in Malaysia:
The most common eligibility criteria to apply for a personal loan include, but are not limited to:
The personal loan application process is typically completed in 48 hours or less. However, it is dependent on the bank you have chosen.
There are two platforms from which you can obtain a personal loan:
The following are the most common reasons why the bank rejected your personal loan application:
Other factors that may cause your personal loan application to be rejected.
Yes, every personal loan will incur interest. However, interest rates vary depending on the type of loan you are applying for and your chosen banks. Typically, the average interest rate on an unsecured loan is around 6-10% p.a., whereas a secured personal loan is between 5-8% p.a.
The common fees when you apply personal loan are:
However, it varies from one bank to another.
Most banks or financial institutions allow borrowers to select a loan tenure ranging from 1 year to 5 years based on their needs. However, different banks may have additional terms.
“Annual Percentage Rate (APR)”
The yearly total cost of borrowing money. This rate includes the interest rate as well as any additional finance charges.
When you apply and receive a loan, you are considered the borrower and must repay the loan according to the terms agreed upon.
The entity that gives out the loan to you and in this case, it is the bank.
The asset that the lender has the right to seize if you fail to repay the loan, and it can include a car, house, cash, or investments.
The bank will look at your credit score to determine how much of a risky borrower you are. As a result, you will be able to repay your loan.
If you pay your loan payment after the due date, your lender may charge you a late fee.
You will be penalised if you try to pay off your loan before the specified loan term.