We knew when we started Raining Pesos that clearing up this big mess in making the best car loan decision would be a compelling factor in driving traffic to our site. But holy cow we didn’t know how many things you need to consider! It’s a big mess!
New car loans are somewhat straightforward. We’ll focus on the mess that is used car loan financing. Here it goes:
1. Year Built: What year was the car built? Each bank can have a different age limit for a used car loan. The older the car, the more chance it might break down and completely lose its value. Thus, banks don’t want to take on the risk, but their choice for how much risk to take varies bank to bank.
2. Brand: Some banks don’t like some car brands! Believe it or not, some banks would simply rather not provide loans for cars that have spotty quality records. For the same reason as age, there is risk if the car breaks down and becomes valueless. Although that 2007 Chery might be in your price range, you might have trouble finding a bank to provide a loan.
3. Location: Where do you live? Not all banks will loan to all areas, and each bank has different rules. There are even “off-limit” areas within Manila.
4. Terms: The terms offered are different based on the model year of the car. Generally, the older the car, the shorter the loan terms offered. These will also vary by bank, since banks will survey the market and possibly offer unique terms to capture take on risk and capture more business.
5. Down Payment: More spaghetti! The model year, length of loan term, brand & model of the car can all affect the amount of downpayment that will be required. And guess what, each bank can be different!
Are you ready to dance the Spaghetti? The good news is that we’ve done all the research work for you up front. As you apply, we make these choices clear. Step 2 in our online car loan application will show you how your monthly payment, down payment, and bank options will change as your choice of car changes. It makes quite a difference! And if you ever have questions, our loan assistants will be more than happy to guide you, either through online chat or on the phone. All the best in your quest to buy your dream car!