The Loan Termination Letter is a crucial document used in Malaysian banking and financial transactions to formally end a lending arrangement between parties. It serves as official documentation when a loan is either fully repaid, being terminated early, or needs to be cancelled for other reasons. The letter must comply with Malaysian financial regulations, including the Financial Services Act 2013, Contracts Act 1950, and where applicable, the Moneylenders Act 1951. This document is essential for maintaining clear records of loan termination, protecting both lender and borrower interests, and ensuring proper closure of financial obligations. The letter typically includes details of the original loan agreement, confirmation of final settlement or outstanding amounts, release of any securities, and formal acknowledgment of the termination by all parties involved.

1. Letter Header: Sender's details, recipient's details, date, and reference number

2. Loan Reference Details: Original loan agreement details including date, reference number, and initial loan amount

3. Termination Statement: Clear statement of intent to terminate the loan agreement

4. Outstanding Balance: Statement of final loan balance or confirmation that loan has been fully settled

5. Effective Date: Specific date when the termination takes effect

6. Confirmation Request: Request for acknowledgment or confirmation of the termination

7. Closing and Signature: Professional closing, signature block, and contact information