Document background
The Payment Letter Mortgage is a crucial document in Malaysian property financing transactions, used when a financial institution extends a mortgage loan to a borrower for property purchase or refinancing. This document, compliant with Malaysian banking and property laws, serves as formal confirmation of the mortgage arrangement and outlines all essential terms and conditions. The letter is typically issued after loan approval but before the execution of the full mortgage documentation. It contains critical information such as loan amount, interest rates, payment terms, security details, and borrower obligations. The Payment Letter Mortgage must comply with both the National Land Code 1965 and Financial Services Act 2013, and in cases of Islamic financing, also adheres to Shariah principles under the Islamic Financial Services Act 2013. This document is particularly important in Malaysia's dual banking system, where both conventional and Islamic mortgages are common.
