Personal Loan 2022


When should you apply for a personal loan? In fact, there is never the best time to apply for a personal loan when you are not ready to get a personal loan. In this article, you will find out what to do and not to do when applying for a personal loan based on the experience and best practices of Malaysians by 2022. Keep reading to find out what a personal loan is, how you can apply for a personal loan with the lowest interest rates and the highest amount, and what you should do after a personal loan is approved or rejected.


Personal Loan 2022 - Research Stage

At this stage, you will find a variety of answers to questions you may have about personal loans by 2022, and how you can use this information to make the right decisions.


How does a personal loan work?

Simply put, a personal loan is a sum of money with interest lent by a bank / financial institution to a borrower for a fixed period of time. The loan must be repaid in regular installments, every month until the end of the period.


What type of personal loan should I take out?

Now that you have understood some of the basics of personal loans, it is time to answer the question of choice.


By comparing Personal Loan 2022, you can filter and choose which personal loan is best to use. Interest rates should not be the only factor when comparing between available personal loans, but it depends on your preferences as well, such as:


  1. "What's the difference between a secured and unsecured loan?"
  2. "Should I get a conventional or Islamic loan?"
  3. "Do I need takaful or insurance coverage?"



Secured Personal Loans Vs Unsecured Personal Loans


Secured Personal Loan

Loans that require collateral or security such as fixed deposits, real estate, unit trusts and other assets. Guarantors are required, with or without assets, depending on eligibility.


Unsecured Personal Loan

No guarantee or security is required. There is no guarantor, except when you do not meet the set eligibility requirements.


Conventional Personal Loan VS Personal Loan (Islamic)


Conventional Personal Loans

  • Based on the principle of lending money, where the bank earns a certain amount of profit for lending money to the borrower
  • Payment of interest rate on the loan amount
  • Can be used for lawful purposes
  • The borrower bears all the risks associated with the loan
  • compound is imposed when the original payment is in arrears


Personal Loan (Islamic)

  1. Follow Shariah financing contracts that avoid exploitative profits such as riba '
  2. Pay the % profit rate from the total financing amount
  3. Can be used for purposes permitted (halal) by Shariah law
  4. The Bank bears some risk to earn a return
  5. Profit compound is not charged when payment is in arrears


With Takaful Or Insurance Vs Without Takaful Or Insurance


With Takaful or Insurance coverage


  1. Liability protection that helps settle all unpaid balances in the event of the death or permanent disability of the borrower
  2. Quite expensive because the coverage is added to the loan amount


Without Takaful Or Insurance Coverage


  1. The borrower / heir is responsible for protecting the unpaid balance in the event of death or permanent disability
  2. You receive 100% of the loan amount


Do I need to apply for a Personal Loan 2022?

Everyone has a purpose to achieve in their life and many times, they need money to start the journey. We can earn money in any way we can, such as a job, the sale of a product or service, our own savings, and even a loan. Some people are fortunate enough to fund their goals with one or more of the above combinations of methods. But, what about others who have limited options or limited options that are not feasible? Often, they shy away from the last option, which is a loan. If we look at this objectively, applying for a personal loan is practical for several reasons:


  1. Education
  2. Investment
  3. Health
  4. Emergency cash
  5. Financing for business
  6. Buy real estate (house, car, equipment etc)
  7. Debt consolidation



Personal Loan 2022 For Debt Consolidation


When you have a lot of bad debts of various sizes, banks, deadlines, terms and interest rates, it is a daunting task to keep track of your personal loan repayments. Debt consolidation loans are great for simplifying various bad debts into one facility. You can pay it off with a lower interest rate with a longer term to save on your monthly installment payments and have more income to carry forward.


Personal Loan 2022 Application Journey 2022

When applying for a personal loan especially in 2022, there are several things you need to consider such as the amount of loan you will get, the actual amount the bank can lend to you, the required documents and the place / bank for you to apply for a personal loan.


How much can I borrow?

The amount of a typical personal loan that you can borrow from a bank is between RM5,000 to RM200,000. This amount is also known as the principal amount. Once you have determined how much your principal loan amount is, you need to choose a period that suits your financial ability to repay the loan.


Through online, there are various websites that have personal loan calculators where you can calculate your monthly payments easily by showing the loan amount, monthly income and the period of your choice in general. There will probably be a slight difference with the actual situation when you apply for a personal loan 2022 and beyond.


However, this personal loan calculator does not take into account your other monthly commitments such as car loans, home loans, credit cards, education loans etc., which will also be considered by selected banks before approving the amount of personal loans you tree. To better manage your expectations (such as high loan margins, low interest rates, quick approvals), you need to check if you can afford your monthly commitment amount by determining your “Debt-Service Ratio” (DSR).



How much personal loan can a bank lend me?

DSR is a tool for measuring the cash flow available after meeting your debt obligations. The bank uses this calculation to see if you have enough money to repay your monthly installments through this formula:


Total Monthly Commitments ÷ Total Monthly Income x 100% = DSR

Example: RM1,500 ÷ RM3,000 x 100% = 50%



What documents need to be provided when applying for a personal loan 2022?

To expedite your personal loan application process, make sure you have gathered all the required documents. The type of document will vary from bank to bank, depending on your type of job. Overall, you can find the general requirements in any website related to the basic terms of personal loans.


Where can I Apply for a Personal Loan?

There are two ways you can apply for a personal loan in Malaysia, namely through offline and online. In the offline channel, you can enter the bank's preferred branch, talk to the officer who manages the personal loan, fill out the application form, submit documents and submit. Another way is to contact the bank's own customer service contact center. In this way, it provides a more detailed service, although there are drawbacks, as you may not have the flexibility in terms of time and money.




On the online channel, you can easily compare and apply for a personal loan 2022. You can also use several indicators to find out your credit score, calculate loan affordability, download statements and more - all at your fingertips. Through this personal loan website, you have various types of personal loans that can meet your needs with a quick and easy online loan application.



Personal Loan 2022 Approval Process

There are various ways in which a bank can issue an approved personal loan to you. Some banks will ask you to open a savings account with them, while others will give you a check or by doing an IBG Transfer to the bank account you designate. Remember that your eligibility, credit history and credit score play a major role in determining the approval of your personal loan application.


Am I eligible?

To qualify for a particular personal loan application by 2022, you must meet the eligibility criteria as set by the bank, including but not limited to:


  1. Citizenship: Malaysian citizen, permanent resident or foreigner


  1. Age: 21 - 60 years old


  1. Type of employment: Paid employee (public / private sector) or self -employed


  1. Type of income: Fixed, contract, commission etc.


  1. Residential status: Own house, rent, living with family / relatives, company provided etc.




Tips: Your lifestyle is also a contributing factor to your Personal Loan 2022 approval. If the bank sees inconsistencies in your employment history, salary and disposable income, as well as place of residence, you may not be a good borrower. So, the chances of getting your personal loan are difficult.


What is credit history?

Credit history shows a record of your debt payments, and shows your ability to make repayments on a loan. By referring to the Central Credit Reference Information System (CCRIS), banks can obtain an overview of the regularity of previous payment records. This credit report keeps all your credit history from all financial service providers in Malaysia for up to 12 months.



What is a credit score?

A credit score is a 3-digit numerical assessment that assesses a borrower’s credit worthiness and is based on their credit history. A good credit score can increase your chances of getting a loan approved with lower interest rates and faster loan approval. A high credit score means you will be liked by the bank, while a lower credit score means your application may be disliked or rejected. CTOS Data Systems Sdn Bhd (CTOS) is a privately run credit agency that collects data from public sources which will be referred to by the bank during the process of approving a personal loan.



Best Case Scenario - Loan Application Is Approved

  1. Loan approval 1 to 5 working days
  2. Will get notification from the bank upon payment
  3. The contract documents received consist of a product disclosure sheet, a personal loan repayment schedule, and terms and conditions
  4. Check bank accounts to get money



Worst case scenario - loan application is rejected

  1. Contact the bank to follow up
  2. Check your repayment history (previous loans such as PTPTN) through CCRIS
  3. Check your credit score through CTOS
  4. Improve your creditworthiness by making instant payments
  5. Wait a while before applying for a new personal loan from a bank



Monthly Commitment

This is the most important stage after your Personal Loan 2022 is approved. Your future loan application, especially such as a home loan, will greatly affect your life if you do not pay off current debts properly.


When is the deadline for my personal loan monthly installments?

Your first monthly installment payment will start a month after receiving the loan you approved into your bank account. Depending on the terms and conditions of your personal loan, the deadline of your monthly installment can fall on the first or mid -month date.


If, at any time of the installment period, you are unable to provide a full commitment, you can pay the minimum amount as recommended by the bank. Doing so will save you from being fined for late payment, will result in you having to pay a fine of between 15% - 18% p.a. on the unpaid balance.


What happens if I am late paying my Personal Loan 2022 installments?

Always strive to make full payment of your installments before or on the deadline to avoid any penalties from the bank. Not only that, your credit score will change for the worse. Generally, all banks will charge a 1% fee, while non -banks will charge around 8%, calculated daily until you pay it off. For example:


Outstanding amount: RM875

Number of days in arrears: 10

Late payment charge: 1% p.a.

RM857 x 1% x (10 ÷ 365 days) = RM0.23



If you almost fail to repay your personal loan, you must immediately contact the bank to discuss your possible repayment. Alternatively, you can use the Credit Counseling and Management Agency (AKPK), a debt management program by Bank Negara Malaysia that offers free services on money management, credit counseling and debt restructuring for individuals.


Can I pay off my personal loan balance earlier?

You have the option to pay off your outstanding Personal Loan 2022 balance before expiration, subject to the terms and conditions of the personal loan itself.


Tips: Personal loans are usually calculated based on a fixed rate; therefore, partial settlement is not recommended. If you have twice paid your monthly installments for the month, the bank will treat it as an “Advance Payment”, which will not reduce your interest payments and principal amount for the month.


It is important that you inform the bank in writing before the early settlement of your personal loan. An early settlement fee may or may not apply, depending on the personal loan agreement.


How to make my monthly installment payment?

You have the flexibility to make your monthly installment payments in various channels as follows:


  • Online banking (IBFT or IBG transfer, bill payment etc)
  • Fixed instructions (automatic deletion)
  • Cash deposit
  • Payment at the counter



Financial Freedom

Achieving financial freedom means you are no longer tied to unchecked debt. This comprehensive Personal Loan 2022 guide and tips is intended to help you make the right financial decisions and get your personal loan application approved as you expect.


Here, we understand your needs and concerns when applying for a personal loan.