Excited to finally drive your own car through the streets of Metro Manila? If you have finally decided to get your car, then you must also be ready to face the nitty gritty of finding getting an auto loan aside from your car. Yes, almost everybody dream of having a car. But only few knows the reality of how important it is to take time in finding the right auto loan until they are smack right at the face by an outstanding monthly dues way too much than they can handle.
Getting a car now at a more affordable price is easier than it used to, however, you could also easily make mistakes that may increase your monthly repayments if you are not careful in choosing your auto loan. Take time to compare auto loans including those from banks you don’t usually see as much as BPI and BDO. Some banks such as the China Bank Savings also have an auto loan that may prove to be a better choice.
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China Bank Savings Auto Loan
CBS Auto Loan is offered to Filipinos and foreigners who have been living in the Philippines for the past two years with complete and legitimate immigration documents. You must be at least 21 to 65 years old throughout the tenure of the loan. Unlike the other banks which usually focus on giving auto loans to individuals, CBS Auto Loan is also created for business entities such as corporations, single proprietors and partnership for acquiring and refinancing vehicles.
Basically, the required documents have to prove that you have been regularly earning a consistent amount of income. For employed borrowers, these are the latest BIR Form 2316, Contract of Employment (COE), pay slips for the last two months and a proof of billing. While the proof of billing does not prove the amount of your salary, it shows your address and payment behavior. If you are determined to get an auto loan (or any amount of loan), it is also vital to pay your bills on time to shoe that you are a responsible payer. If you have your own business, you have to present the Latest Business Registration and BIR Form 1701/1700 in place of the BIR Form 2316 and COE or pay slips. If you are an entrepreneur, you should be ready to prove that your business has been regularly generating an income for quite some time.
Since the China Bank Savings Auto Loan is also available for corporate borrowers, they also have a list of requirements, namely: BIR Form 1702, SEC Papers such as SEC Certificate, Articles of Incorporation, By-Laws, Latest General Information Sheet and the company’s original proof of billing.
Borrowing within your means
When you are getting a loan, you must know how much you are really going to need to borrow. Too small will fall short and you might have to take another loan, while too big of an amount will generate high repayment than necessary. China Bank Savings offers a minimum of Php250, 000. This is higher compared to the minimum amount offered by other banks, if you plan to get lower than Php 250,000, you may have to choose another loan provider. On the other hand, the maximum loan amount is the same as most banks: 80% of the vehicle’s purchase price. This means that you have to be ready to pay off 20% of the vehicle’s price upfront.
Another thing you have to consider, is the loan term. Take your sweet time considering this point. The shorter the term, the lower the interest rate, but expect higher monthly repayment. CBS Auto loan offers loan terms depending on the purpose of the loan and the vehicle’s age. Before applying for a loan, you may personally go to a CBS branch and ask for a quotation first before applying for the loan. There is a danger with aggressively applying to multiple lenders as this will be reflected to your credit report and banks will see this as desperate move. This is one of the reasons why loan applications get declined.
Charges you have to detect
When we think of loans, the only charge we can point out is the interest rate, however, there are still other charges that exist within the realms of auto loans. Remember that CBS Auto Loan is a secured loan with the financed vehicle used as your collateral, this is why you also have to pay for the documentary stamp, chattel mortgage fee, and motor vehicle insurance. Do not forget to ask the bank about the appraisal fee too.
- CBS Auto Loan has a fixed rate interest rate that depends on the bank’s discretion. The advantage of the fixed rate is the ability to foresee your expenses and being able to budget you finances without any worries if your interest rate will fluctuate.
- When you are applying for the CBS Auto Loan, you have to make sure that all your details are accurate and consistent with all of your submitted documents. Also, be sure that all of the documents are latest and valid to ensure that your loan process will only take a day.
- Minimum loanable amount is higher than most auto loans. If you need a lower amount, then you have to opt to another bank or lender.
- Limited only to those within the service area of the bank. Unlike BPI, BDO or online lenders who offer an Auto Loan, CBS only has 160 branches nationwide and its services are only offered to those within the area range of the banks. If you live in a city which has no CBS branch, then you probably can’t avail the loan.
On the other hand, if you need a flexible loan to be used on other personal purposes, there is no need to use your car as collateral, just login to CashMart.ph and apply for an online personal loan to get the most convenient loan in the country today.