We help you with everything including applications and paperwork submission to ensure you get the best loan possible to finance your dream car.

Please see the loan eligibility requirements above. The financial providers will also take into account your creditworthiness by assessing your income level and documents submitted, among other requirements.

The maximum loan amount you can get on a car is usually 90% of its value. That means you will have to make a 10% down payment on the car. Used cars usually require a down payment of 20%, with the car loan amount being 80%. Feel free to speak to a CARSOME Consultant to come up with the best terms to suit your needs.

In a car loan agreement in Malaysia, the car serves as collateral. If the bank perceives the car to have a lower value than the loan, the chances for the loan to be approved might drop since the car’s value may not be enough to pay off the loan. This is important because if you are unable to pay your monthly installment and default on the loan, the bank will repossess the car.

The monthly payment for your car loan depends on the total car loan amount, car loan interest rate, and car loan tenure.

Yes. You can contact the bank/loan provider to enquire about the loan balance on your car. You can also use your loan provider’s online banking platform to check it. The car loan statement with details about the loan is usually available to download.

CARSOME partners with various loan financiers that have varying car loan interest rates. To help you get a good deal, CARSOME can assist you in choosing the financier or bank that suits your needs. You can also apply for a car loan from CARSOME Capital which offers attractive interest rates, a high margin of finance, and easy application process.

A pre-approved loan is a financing offer given before a customer chooses a car, based on an early credit check. It helps them know their borrowing power, speeds up purchase decisions, and reduces uncertainty.

From 1 June 2026, Malaysia's car financing rules changed to make loan charges clearer and fairer. Here's what it means for you.

1. What is the Hire-Purchase (Amendment) Act (HPAA)?

It's an update to Malaysia's car financing law, in force since 1 June 2026. It removes the old “flat rate” and “Rule of 78” interest calculations for new car loans, replacing them with a fairer method where interest is charged only on what you still owe.

2. Does it affect my existing car loan?

No. Existing loans continue under their original terms — your rate, installment and schedule stay the same.

Good news if you want to settle early: banks now offer goodwill discounts on early settlement of older loans, so your settlement amount is closer to what it would be under the new method. Ask your bank for a settlement quote.

3. What's actually changing for new car loans?

• Interest is charged on your outstanding balance — as you repay, you're charged less. Previously, interest was calculated on the full original loan amount for the entire tenure.
• Rates are quoted as an Effective Interest Rate (EIR) — or Effective Financing Rate (EFR) / effective profit rate for Islamic financing — so offers are easier to compare.
• You can sign documents digitally — no need to be physically present at the bank.
• Fixed and variable rates both remain available.

4. What is an EIR?

The Effective Interest Rate shows the true cost of your loan, because it's based on what you actually owe over time. Two loan offers with the same amount, tenure, and EIR will have the same total financing cost.— making it a direct comparison between loans . The lower the EIR, the less interest you pay.

5. Why do new rates look higher than before?

They're not necessarily more expensive — they're just quoted differently. A flat rate of 3% and an EIR of about 5.5% can be the same loan. The flat rate only looked lower because it was calculated on the original amount, ignoring the fact that your balance shrinks as you repay.

Don't compare a flat rate with an EIR directly. Use an EIR calculator to convert an old flat-rate offer, then compare EIR to EIR.

6. What's the transition period?

Banks and credit companies have until 31 March 2027 to fully switch their systems over. Until then, some may still offer packages under the old method. Before signing, ask whether your package uses the reducing-balance method and what the EIR is.

7. Fixed rate vs variable rate — what's the difference?

Under the new rules, both types use the reducing-balance method — the only difference is whether the rate can change.

8. What Are the Overnight Policy Rate (OPR), Standardised Base Rate (SBR) and Reference Rate? 

The OPR is set by Bank Negara Malaysia and influences borrowing costs. The SBR is a benchmark linked to the OPR and is used for variable-rate retail financing.

Under the HPAA 2026, new variable-rate hire-purchase financing will use a Reference Rate based on the prevailing OPR. A fixed spread is added to the Reference Rate to determine your actual financing rate.

For example: Reference Rate + spread = your financing rate

If the Reference Rate changes, your financing rate and instalment may also change. The spread generally remains fixed throughout the financing tenure.

9. What happens if I settle my loan early?

Under the new reducing-balance method, you simply pay off your outstanding balance — no more heavy early-settlement penalties from front-loaded interest. For older loans, ask your bank for an official settlement quote; goodwill discounts may apply.

10. How should I compare loan offers?

Use the same car price, down payment and tenure, then compare:

• The EIR (or EFR / effective profit rate)
• Whether the rate is fixed or variable — and for variable, which Reference Rate applies
• The monthly instalment and total amount payable
• Early-settlement terms
• Fees, insurance or takaful, and other costs

For variable-rate offers, ask for an illustration of your instalment if the Reference Rate rises by 1–2%.

11. Do all banks and credit companies follow the HPAA?

Yes — it applies to every hire-purchase agreement, whether from a bank or a non-bank credit company. The transition period gives providers time to update systems; it's not an opt-out. If a product isn't a hire-purchase agreement, different rules may apply — ask the provider what type of financing you're being offered.

12. Are the rates shown on CARSOME final?

Rates and instalments shown are indicative. Your final rate depends on the financing provider, your credit assessment, the vehicle and the tenure. Always refer to your approved offer, Product Disclosure Sheet and financing agreement for the final rate, calculation method and terms.