Auto Loan Contract Template for Malaysia

The Auto Loan Contract serves as the primary legal instrument for vehicle financing transactions in Malaysia, structured in accordance with the Hire-Purchase Act 1967 and other relevant financial regulations. This document is essential when a customer seeks financing from a financial institution to purchase a motor vehicle, establishing the legal framework for the loan disbursement, repayment obligations, and security arrangements. It incorporates mandatory consumer protection provisions, detailed vehicle specifications, insurance requirements, and enforcement mechanisms. The contract is designed to protect both the lender's security interest and the borrower's rights while ensuring compliance with Malaysian banking and consumer protection laws. It includes specific provisions for various scenarios such as early settlement, default, and vehicle maintenance obligations.

1. Parties: Identification of the lender (financial institution) and borrower with complete details as required by Malaysian law

2. Background: Context of the loan agreement and brief description of the transaction

3. Definitions: Definitions of key terms used throughout the agreement, including technical financial terms

4. Loan Details: Principal amount, interest rate, tenure, and total amount payable as per Hire-Purchase Act requirements

5. Vehicle Details: Comprehensive description of the vehicle including make, model, year, chassis number, and engine number

6. Payment Terms: Monthly installment amount, payment dates, and payment methods

7. Security and Registration: Details of vehicle registration, ownership status, and security arrangements

8. Insurance Requirements: Mandatory insurance coverage requirements and terms

9. Borrower's Representations and Warranties: Borrower's declarations regarding their capacity and ability to enter into the agreement

10. Borrower's Obligations: Ongoing responsibilities including vehicle maintenance, usage restrictions, and payment obligations

11. Events of Default: Circumstances constituting default and consequences thereof

12. Lender's Rights and Remedies: Actions the lender can take in case of default, including repossession rights

13. Early Settlement: Terms and calculations for early loan settlement as per Malaysian regulations

14. Notices: How formal communications between parties should be made and delivered

15. Governing Law: Specification of Malaysian law as governing law and jurisdiction

16. Execution: Signature blocks and witness requirements as per Malaysian law