Affin Bank’s car loan interest rates are fixed and vary depending on whether the vehicle is new or used, and whether it is a local or foreign model. For new local vehicles, the interest rate is 2.92% per annum, while used local vehicles attract a rate of 3% per annum. New foreign vehicles have a slightly lower rate of 2.6% per annum, while used foreign vehicles maintain the same rate as used local vehicles at 3% per annum. This structured approach allows borrowers to understand exactly what they will be paying throughout the loan tenure.
Affin Bank Hire Purchase Interest Rate
How Does Affin Bank Determine These Rates?
The rates are determined by a combination of factors including the tenure of the loan, which can be up to nine years for new vehicles and seven years for used ones. The margin of finance also plays a role, with new cars eligible for up to 90% financing, while used cars can receive up to 85% financing. This structured approach ensures that borrowers have clarity on their financial commitment.
What Are the Fees and Charges Involved?
Affin Bank outlines several fees and charges associated with their car loans. There is a photocopy charge of RM10 and a consent letter fee of RM50. Importantly, there is no early settlement fee, providing borrowers with flexibility if they choose to pay off the loan ahead of schedule. However, a late penalty fee of 8% per annum on the outstanding amount is imposed, calculated daily, for late payments.
Who Can Apply for Affin Bank’s Car Loans?
Affin Bank’s car loans are accessible to a wide range of individuals and entities. Eligibility extends to Malaysians and Permanent Residents, sole proprietors, partnerships, and private or public limited companies. Applicants must be at least 18 years old, and the bank requires a minimum annual income of RM24,000. For those under 21, a guarantor may be necessary due to perceived higher risk.
What Is the Process for Applying for a Car Loan?
Applicants need to provide several documents for the application process. For salaried individuals, these include a photocopy of the NRIC or Passport, a valid driving license, and recent pay slips or tax forms. Self-employed individuals and business entities must submit business registration certificates, bank statements, and financial statements, among other documents.
Can Borrowers Make Early Settlements?
Yes, borrowers can settle their car loans early. Affin Bank offers a rebate on the remaining interest charges if the loan is paid off in a lump sum. This feature provides borrowers with an opportunity to save on interest costs, making the loan more flexible and borrower-friendly.
What Happens if Borrowers Fail to Pay Installments?
Failure to pay monthly installments can lead to serious consequences. Under the Hire Purchase Act 1967, the bank has the right to repossess the vehicle if payments are missed for two consecutive months. However, if payments are simply overdue, a late penalty charge will be applied. It is crucial for borrowers to maintain timely payments to avoid these penalties.
How Do Affin Bank’s Rates Compare to Other Banks?
Affin Bank’s interest rates are competitive compared to other financial institutions in Malaysia. For instance, Maybank offers rates starting from 3.40% per annum, while RHB’s rates begin at 3.18% per annum. The lower rates offered by Affin Bank for certain vehicle types make it an attractive option for many borrowers.