Secured Loan Note for Malaysia

Secured Loan Note Template for Malaysia

A legally binding financial instrument governed by Malaysian law that documents a loan agreement where the borrower provides specific assets as security for the loan. The document details the loan amount, interest rates, repayment terms, and security arrangements, complying with Malaysian financial regulations including the Financial Services Act 2013 and Contracts Act 1950. It includes comprehensive provisions for security creation, enforcement rights, events of default, and remedies available to the lender, while ensuring compliance with local registration and stamping requirements.

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What is a Secured Loan Note?

The Secured Loan Note is a fundamental financing document used in Malaysian lending transactions where a lender provides funding against specific security assets. This document is essential when businesses or individuals seek secured financing, requiring detailed documentation of the loan terms, security arrangements, and enforcement mechanisms. The document must comply with Malaysian legal requirements, including the Financial Services Act 2013, Companies Act 2016, and relevant security registration requirements. A Secured Loan Note typically includes comprehensive provisions protecting the lender's interests while clearly outlining the borrower's obligations and the consequences of default. It's particularly important in commercial lending where significant assets are provided as security for the loan.

What sections should be included in a Secured Loan Note?

1. Parties: Identification of the Lender and Borrower with full legal names and addresses

2. Background: Context of the loan arrangement and purpose of the facility

3. Definitions and Interpretation: Definitions of key terms used throughout the document and interpretation rules

4. The Facility: Details of the loan amount, purpose, and availability

5. Interest: Interest rate, calculation method, and payment periods

6. Repayment Terms: Schedule of repayment, payment methods, and prepayment provisions

7. Security: Description of security/collateral provided and creation of security interest

8. Representations and Warranties: Borrower's confirmations regarding their status, capacity, and authority

9. Covenants: Positive and negative obligations of the Borrower during the loan term

10. Events of Default: Circumstances constituting default and consequences

11. Enforcement: Lender's rights and remedies upon default

12. Notices: Communication methods and contact details for formal notices

13. Governing Law and Jurisdiction: Malaysian law as governing law and jurisdiction for disputes

What sections are optional to include in a Secured Loan Note?

1. Guarantee: Required when there is a guarantor securing the loan obligations

2. Insurance: Required when specific insurance coverage is mandatory for the security

3. Assignment and Transfer: Include when the loan note may be transferable

4. Additional Security: Required when multiple forms of security are provided

5. Tax Provisions: Include when specific tax considerations need to be addressed

6. Change of Circumstances: Include provisions for market disruption or changes in law

7. Costs and Expenses: Optional detailed section on cost allocation and payment responsibilities

What schedules should be included in a Secured Loan Note?

1. Repayment Schedule: Detailed amortization table showing payment dates and amounts

2. Security Details: Specific description and documentation of security/collateral

3. Conditions Precedent: List of documents and conditions required before loan disbursement

4. Form of Notice: Template forms for various notices under the agreement

5. Security Documents: Forms of any additional security documents required

6. Fees and Charges: Detailed breakdown of all applicable fees and charges

7. Calculation of Interest: Detailed methodology for interest calculation

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Malaysia

Publisher

Genie AI

Document Type

Promissory Note

Sector

Banking

Cost

Free to use
Relevant legal definitions
Relevant Industries

Banking and Financial Services

Real Estate

Manufacturing

Commercial Property

Industrial

Retail

Agriculture

Technology

Healthcare

Construction

Infrastructure

Small and Medium Enterprises

Relevant Teams

Legal

Finance

Credit

Risk Management

Compliance

Treasury

Corporate Secretariat

Loan Operations

Security Administration

Documentation

Relevant Roles

Legal Counsel

Finance Director

Credit Manager

Loan Officer

Risk Manager

Compliance Officer

Corporate Secretary

Treasury Manager

Chief Financial Officer

Banking Relationship Manager

Security Trustee Officer

Documentation Specialist

Legal Operations Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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