How to Apply for a Car Loan

May 31, 2016 | Posted by: Bea Bongat | Car Insurance

May 31, 2016


 

How to Apply for a Car Loan | MoneyMax.ph

 

350,000 units – that’s the projection of the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) as to the number of cars that will be sold this year. It’s 12.9% higher than last year’s projection of 310,000. Are you one of those planning to by a car this year? Unless you have a million or more pesos to spare in the bank, you’ll most likely be applying for a car loan.
If you’re at a loss on where to start when it comes to car loans, you’ve come to the right page. Below is a step by step on how to apply for a car loan and where you can go to apply:

Where to Apply for a Car Loan

The following financial institutions offer car financing:
BDO Unibank, Inc. (BDO)
Down payment: minimum 20% of purchase price
Maximum car age: up to 6 years old
Minimum household monthly income: PHP 50,000
Payment terms: 12-60 months
Bank of the Philippine Islands (BPI)
Down payment: minimum 20% of purchase price
Maximum car age: up to 5 years old
Minimum household monthly income: PHP 30,000
Payment terms: 12-60 months
EastWest Bank
Down payment: not stated
Maximum car age: not stated (for secondhand vehicles, units to be brought in for appraisal)
Minimum household monthly income: PHP 40,000
Payment terms: 12-60 months
Maybank
Down payment: minimum 20% of purchase price
Maximum car age: up to 10 years old
Minimum household monthly income: not stated (employed or self-employed for at least 2 years)
Payment terms: 12-60 months
Metrobank
Down payment: minimum 20% of purchase price
Maximum car age: brand new units only
Minimum household monthly income: not stated (employed or self-employed for at least 2 years)
Payment terms: 12-60 months
Philippine Bank of Communications (PBCOM)
Down payment: minimum 20% of purchase price
Maximum car age: (for secondhand vehicles, units to be brought in for appraisal)
Minimum household monthly income: PHP 40,000
Payment terms: 12-60 months
Philippine National Bank (PNB)
Down payment: minimum 20% of purchase price
Maximum car age: up to 7 years old
Minimum household monthly income: not stated (employed or self-employed for at least 2 years)
Payment terms: 12-60 months

RCBC Savings Bank (RCBC)
Down payment: minimum 20% of purchase price
Maximum car age: not stated (for secondhand vehicles, units to be brought in for appraisal)
Minimum household monthly income: 3x monthly amortization
Payment terms: 12-60 months

Security Bank
Down payment: minimum 20% of purchase price
Maximum car age: up to 11 years old
Minimum household monthly income: PHP 40,000
Payment terms: 12-60 months
United Coconut Planters Bank (UCPB)
Down payment: minimum 20% of purchase price
Maximum car age: not stated
Minimum household monthly income: PHP 30,000
Payment terms: 12-60 months
Unionbank
Down payment: minimum 20% of purchase price
Maximum car age: not stated
Minimum household monthly income: PHP 50,000
Payment terms: 12-60 months

How to Apply for a Car Loan

Follow the three steps below to make your application process a breeze:

1. Research

As with anything, it’s best to always do your research first. Before you submit your application, either online or in person, it’s best to know the specifics of the car loan you’re applying for. If you haven’t bought a car yet, you have to know how much the car you’re eyeing is worth, and whether or not you can already afford the downpayment. Even more, you have to know how long you’ll be willing to pay your loans as payment terms vary from 12 to 60 months. With that, interest rates vary as well, depending on a number of factors such as your income, your credit history, and even your payment terms with the loan.
It’s best to do your research first so you come prepared when it’s time to apply. There are also online assessment tests wherein you put your income, your payment term, vehicle amount, and percentage of downpayment. By taking the test, you’ll know what to expect and the loan amount you can afford.

 2. Fill up application form

After you know your preferred bank to apply for a loan, you can go to the bank’s website and download an application form. Information that will be asked includes your employment and bank details, such as your monthly income and the outstanding balance of your bank accounts.

3. Show your documents

After you complete the form, you have to submit a number of documents. They are as follows:

For employed individuals:
Application form
Certificate of Employment (includes salary, position, years of service, and HR’s contact number)
Latest ITR
Valid government-issued ID

For self-employed individuals:
Application form
Audited Financial Statements
DTI Certificate of Registration of Business / Trade Name or Business Permit
Bank Statements
Latest Income Tax Return (ITR)
Valid Government-issued ID

Financing your dreams

Cars serve a variety of purposes. For some, it’s just a means of transportation; for others, it can be a style accessory; for some, it can be also used for business or as an investment. Whichever purpose you have for buying a car, it’s best to make sure to keep your finances in order. This means that once you’re approved for a car loan, don’t forget to pay your monthly amortization on time to avoid incurring interest fees. Even more, the responsibility of car ownership doesn’t stop with the loan payments. It also includes staying prudent when it comes to additional expenses like gas, toll, and maintenance, as well as being a smart driver on the road. Whether you’re driving alone or you have passengers, it’s best to stay protected both through car insurance and driving safely.
If you’re planning to take out a car loan, it’s best to buy insurance as well. This ensures that whatever the situation you’re in, you have the peace of mind that you, your passengers, and your car are insured. You can use MoneyMax.ph’s comparison tool to compare car insurance policies and find the most affordable one for you. Even better, you can do it entirely online through MoneyMax.ph.
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