Hi everyone, I have a personal that I took in 2018 and the details are as below:

Loan Amount: RM 47,800
Interest Rate: 18.62%

Monthly Installment: RM 1,230

Loan Tenure: 5 years

Outstanding balance (as of today) : RM 39,030.79

I did opted for the 6 months moratorium and I've paid in total RM 28,294.27.


I have the money now to make a full settlement and I've called up the bank to ask if there's a rebate given. Feels so unfair to pay the balance interest rates for the upcoming year when I'm not even going to pay monthly anymore.

I've called them twice it's hard to speak with them. Can someone advise on how to go about this?

is early settlement allowed in ur agreement?

some will extra charge abit

1) Check if your agreement allows early settlement, might have additional charges for cancellation.

2) Unfortunately for you, because it's a personal loan, it's most likely calculated on Rule of 78 for interest payment. Since it was a 2018 loan and it's already year 3 of the 5 years tenure, you've already paid easily 80% of the total interest they charged to your loan. Any "rebate" from early settlement of personal/car loan is really just interest you will not be paying from your remaining instalments because you've settled loan early.

That's why when you check now, the outstanding loan is still so high, because your previous instalments is used to pay mostly interest, not the loan itself.

You may read about rule of 78 here: https://loanstreet.com.my/learning-centre/h...-the-rule-of-78

If you want to see how much "rebate" you might get, you can calculate here: https://loanstreet.com.my/calculator/car-an...calculator.html

This post has been edited by DragonReine: Mar 24 2021, 02:40 PM

Visual illustration of Rule of 78/Sum of Digits method of interest calculation and payment, using the figures you gave.

Anyone with later versions of Excel can input this into the Loan Amortization Schedule template workbook, it actually shows how the first half of a loan tenure, less than half of the instalment paid goes to pay the loan itself, majority of it is used to pay interest.



This post has been edited by DragonReine: Mar 24 2021, 04:13 PM

I remember early settlement is allowed but I can't find the agreement I've signed.

Yeah, that's right. The installments I've paid is mostly interest.

Then in that case it's best if you visit bank directly and settle over the counter. I would caution you that your "rebates" AKA unpaid interest at this point is very minimal, and they won't refund interest you've already paid for, as most personal loan agreements would usually indicate that any rebates are calculated using sum of digits method.

Good luck.

This post has been edited by DragonReine: Mar 24 2021, 04:53 PM

Might as well invest it somewhere else low risk like fd

that's how all the bank CEO's last year got fat paychecks and huge bonuses. unlikely they will give you any rebate. can try and call but not worth to pay lump sum.

Haha yeah. That's the thing, I dont want to keep this loan. Such a burden and I've worked really hard to save up.

Oh yeah, that's right. Almost the same.

Peace of mind from being debt free can be more valuable than considering whether it's financially "sensible" to settle early, sometimes.

IMO if it makes you sleep better to be out of debt, settle it even though you "lose" opportunity to invest the extra cash.

With your current outstanding early settlement will save you at least rm2k easily

Worse case you should lodge to BNM and try to get AKPK to help you on mediation because you have the right for early settlement with at least 3% rebate

Wow that interest rate is higher then some Ahlong lender interest what the shit

The price of nearly instant approval and disbursement

Price to pay for good legal lending rather than worried about red paint and chain fencing

I was desperate to get a loan quickly and that was the only offer I had. Sucks but I had no choice. Now can only cry

Hmm yeah, looks like it. Nice, thank you. I'm waiting for the agreement letter that I've signed, then I can try to do this.

Be firm and ask them for one time settlement

If not try and see whether you can transfer the personal loan to another bank with lower interest fees

first thing first, Xpress cash with cimb is fast, but it comes with highest effective interest rates (EIR)
2. as most of our loans are calculated with rule of 78 which cause everyone to pay the interest first before reducing the principle. first few years you will be paying a lot of interest. but not the principle, you can check how many principle left under Outstanding Principal. while the total interest plus principle will be under section Outstanding Balance under your loan detail.

if your cimb xpress outstanding balance is less than outstanding principle, you might be offered a rebate but this is not guaranteed.


as a result. take it as learning outcome that never take xpress cash with cimb .. its fast, but you are surely have to pay more. you can actually ask the officer what personal loan that cimb offers and carefully think before you take any.

cimb credit card loan interest is about 15-18% EIR, cimb cashlite... about 10 to 24% EIR... your xpress cash is at 18.62 lol.


im not specifically against cimb or whatever bank , but as a consumer, we are in control of what we need. dont easily get into debt traps.

Interest rate 18.62% per annum? so high?
I dont know but i always believe the 1st level of borrowing should be from your credit card.
nowadays they provide a lot of those cash installment plan with 0% interest but upfront charge 2.88%, 3.88%, 4.99%.
in a way is they charge those interest Per year upfront. last time they offer me 1.5%/1.8%. i dont need it but i took it out anyway and put into an FD.
i still lose out the effective interest if i dont use it and keep it in FD. but it gives me the cashflow flexibility in the event i need cash

next is balance transfer which i think offers the same but at slightly higher interest rate.
after you exhaust the card, then only come personal loan. during my younger younger years, i took before. like you say no choice, need cash.

last resort is if loans all too high and you have property, then you can refinance and consolidate all your debts into the loan to lower down your interest rate.
if dont have property, final resort is to deal with AKPK.