(Updated 31 January 2017) Having a car in Singapore brings the convenience, peace and freedom commuting will never have. Driving to your office, a family function, a dinner date or anywhere in the island with your own car takes your lifestyle up a notch. For many, it has even become a necessity more than a just a whim.
When you think of buying a car, one of the basic questions to ponder is how to finance it. Unless you have saved up enough to pay the full price in cash, you need a car loan to fit your needs. Is OCBC car loan the best choice you have?
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OCBC Car Loan Eligibility
OCBC offers car financing for new vehicles to Singaporeans, Permanent Residents, and foreigners with proper work permits. The applicant must be 21 years old and interested in buying a brand new car. The bank is proud of its flexible term which is up to 7 years and competitive interest rate of 2.78% a year. Be mindful that the longer the term, the higher is the Effective Interest Rate. When comparing interest rates, it is best to use the EIR instead of the interest rate per annum as it is more accurate.
OCBC Car Loan Requirements
If you plan to apply, you have to present a valid ID, income documents such as payslip, latest 6 months CPF contribution or Income tax notice of assessment, duly filled up application form, and a work permit if you are a foreigner. You also have to prepare the initial deposit as the bank will only finance 60 to 70% of the car’s market value. You can get more information through OCBC’s online Car Financing Enquiry Form.
OCBC New Car Financing
The maximum finance amount you can get depends on Open Market Value of the car you want to purchase. If the car costs less than S$20,000, then OCBC will finance 70% of the vehicle’s market price. For cars worth more than S$20,000, the bank will only finance up to 60%.
OCBC Car Loan Application
Should you decide on OCBC Car Financing, you will have to apply through your car dealer and pay the initial deposit. This is when you have to pay cash for downpayment. Wait for your dealer to contact you for the next meeting. This time, you have to sign the Hire Purchase Agreement and pay the remaining downpayment.
Remember that the bank still has to evaluate the finance amount it will approve based on your financial standing and creditworthiness. Any difference between the market value of the car and the approved finance amount must be shouldered by you. Take note that your dealer might also demand for the first month’s installment.
The dealer will then set another meeting for you to get your car. Expect OCBC to send you the Hire Purchase Agreement and your payment schedule via mail. Then make your monthly repayments with cheque in cheque deposit boxes or with cash at any OCBC branch.
OCBC Used Car Financing
If you are eyeing to buy a used car from a car dealer or a direct owner, then you can consider this loan product. It has a fixed interest rate of 2.98% per year, a loan term of up to 7 years and possibly a finance amount of 60 to 70% of the car’s valuation.
You can apply for the car loan through your car dealer or directly with OCBC. Either way, expect that your credit agent or the car dealer will ask for your first month’s installment. You also have to be ready should you need to pay additional downpayment and an administration fee if any.
OCBC Car Refinancing
This product is especially created for those who have existing car financing with other banks for at least 6 months. You can apply for the Car Refinancing if your current financer has an interest rate of 2.40% or more. The financed period on your existing financer will be deducted from the repayment period of 7 years.
Upon approval, OCBC will pay off your car financing with the other bank and then refinance your vehicle with new terms.
- Though the OCBC site does not discuss any other fees aside from the interest rate, do not forget to ask them about administrative fees/ processing charges, prepayment charges and late payment penalties.
- If you plan to buy an imported car, make sure that you can apply for OCBC’s car financing through your dealer.
- For the used car, the maximum finance amount will base on the depreciated open market value. The value of the car is adjusted according to its age.
- The hire purchase agreement will be sent via mail 7 days upon loan disbursement. Remember to check your repayment schedule and pay diligently to avoid penalties.
- To terminate the GIRO for the OCBC car financing, it has to be at least 5 days before the next repayment is due. You can do the termination only via mail.
- Inform the bank of any changes in motor insurance company via mail.
Choosing the car loan that best fits your needs and even wants is not an easy matter. You need to take time and shop around for the best deals as the right car loan is a key to acquire your dream ride at ease.
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