Requirements You Need to Get A Car Loan in the Philippines
Because our country has a poor and inefficient mass transport system, buying a car is no longer a luxury but a necessity. As such, many Filipinos opt to buy a brand-new or a used car in order to have a more comfortable trip to and from their destination
Cars for sale in the Philippines are not that cheap—especially the brand-new cars. Good thing there’s this thing called a car loan, a financing system that allows you to own a brand-new car in an easier and flexible way. Here are the essential things you need to know how to get a car loan from a bank.
Car Loan Application Checklist
In the Philippines, the usual checklist of eligible car loan applicants is the following—the applicant must be at least 21-years old but not older than 65-years old when the loan matures.
Second, the applicant must have a minimum joint (household or family) monthly income of at least PHP30,000. If the applicant doesn’t meet the minimum monthly income, he/she can include a co-maker. Bangko Sentral ng Pilipinas says a co-maker is a person who, by contract, promises to pay another person’s (principal borrower) loan if that person fails to do so.
Lastly, some banks require applicants to be a regular employee for at least two years.
Car Loan Application Requirements
Before you go shopping for a brand-new or used car, you first need to know the necessary documents needed to apply for a car loan. If you’re working in the Philippines, what you need are the following: (1) the accomplished car loan application form, (2) a valid government I.D., (3) latest proof of billing, (4) a Certificate of Employment, (5) your latest income tax return, and (6) three months of payslip.
Overseas Filipino Workers Can Get a Car Loan
Overseas Filipino Workers (OFW) can apply for a car loan in the Philippines. An OFW can apply for a car loan if he/she has a Filipino relative that’s deemed as qualified by the bank. OFWs should also be working overseas for at least two years and have a minimum salary of PHP30,000 to PHP50,000 per month. OFWs should also have a six-month contract minimum, a certificate of employment, and provide three months’ worth of remittance slips.
Duration of Car Loan
Payment terms refer to the duration of your car loan. Loans involving brand-new cars usually range from 12 to 72 months. Used cars, on the other hand, are from 12 to 48 months, depending on how old the car is. Of note, the shorter duration of a car loan means that you’ll be charged with less interest.
Compare Car Loan Offers
Every bank has its own car loan financing program. As such, it’s best to compare these offers before you choose a specific bank to apply for a car loan. However, if you’ve been with a certain bank for a long period of time, that bank could be your best option when applying for a car loan because there’s a good chance that your application will be approved faster.
Applying for a car loan is not that hard as long as you have all the requirements needed. Although, you need to take note that applying for a car loan is a serious business that could lead to awful endings if you can’t pay the bank. This is why you need to have a stable income before you can think of buying a car and applying for a car loan.
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