A car advertisement in Malaysia almost always quotes a flat interest rate. The interest is not recalculated each month on a shrinking balance. It is principal times the yearly flat rate times the number of years. Add that interest to the principal, divide by the number of months, and you have the instalment. For RM80,000 at 3.5 percent flat over 7 years, the interest is 80,000 × 0.035 × 7 = RM19,600. The total is RM99,600. There are 84 months, so the instalment is RM1,185.714…, which displays as RM1,185.71. The load button runs that case.
The amount you type should be the amount financed, which is the car price minus the deposit, plus any insurance or fees the bank actually folded into the loan. A 10 percent deposit on a RM90,000 car is not a RM90,000 principal. If the bank did not finance the insurance, leave the insurance out. The calculator has no hidden fee.
Flat interest and reducing-balance interest with the same percentage are different products. A 3.5 percent reducing rate costs less interest than a 3.5 percent flat rate, because the reducing rate only charges what you still owe. Comparing a personal-loan APR with a hire-purchase flat rate by staring at the two percentages will pick the wrong loan. Compare total interest, or the monthly instalment on the same principal and the same months.
Early settlement is the other place this page stops. Hire-purchase agreements commonly rebate the unearned interest with a formula buyers know as the Rule of 78. You do not get a pro-rata refund of the remaining months. The rebate is smaller in the early months than a straight-line split, which is why settling in year two does not simply cancel five-sevenths of the interest. Calculate that rebate from the agreement or from the bank's settlement letter. Do not subtract a home-made fraction from the total on this page and call it the settlement figure.
The instalment is also not your full monthly cost of owning the car. Road tax, fuel, service, and tyres are outside the loan. If you are checking whether the instalment fits the salary, use the gaji bersih estimate for take-home pay and then subtract the instalment yourself. A lender's debt-service ratio uses its own definition of income and its own list of commitments. This page will not invent an approval.
Rounding: the interest and the total are exact for the numbers you type, to the sen. The monthly figure is that total divided by the months and then rounded to the nearest sen. A bank that rounds every instalment can put the leftover sen on the last bill. A difference of a few sen is rounding, not a second interest rate.
Work an offer backwards if the advertisement quotes the instalment and hides the rate. Multiply the instalment by the number of months, subtract the amount financed, and you have the interest. Divide that interest by the principal and then by the years, and you have the flat rate this page would have started from. If that rate is much higher than the poster, the poster is not a flat rate, or the principal includes fees you have not typed. Do the forward sum here only after you know which principal the bank is financing. A seven-year loan at a modest flat rate still piles interest on the original principal for all seven years, which is why the RM80,000 example adds RM19,600 rather than a smaller reducing-balance figure.