Margin of financing
This is the loan amount expressed as a percentage of the car's value. For example: if a bank offers a margin of financing of 90% for a car valued at RM100,000, the bank is effectively agreeing to lend 90% x RM100,000 = RM90,000 to the borrower.
Guarantor
A guarantor is a person who agrees to pay off a loan on a borrower's behalf if the latter defaults on the said loan. In Malaysia, a guarantor may be required for a car loan especially if the borrower does not have stable income, or have opted for a loan amount that goes above a predetermined percentage of his or her income.
Repossession
This is when the lender takes away the car from a borrower when the latter fails to service the car loan instalments in two consecutive months. In Malaysia, a car cannot be repossessed if more than 75% of the car loan has been settled.