Full Payment without Loan

[adrianty]

same here...

are you considering PI?

I didn't know there is pi for the car models I listed above. What are the benefits of going through pi apart from no fee and normal freebies for no loan? Cause there is a risk of going through pi with deposit lost if it go bust.

[Inlinefour]

I didn't know there is pi for the car models I listed above. What are the benefits of going through pi apart from no fee and normal freebies for no loan? Cause there is a risk of going through pi with deposit lost if it go bust.

If you intend to pay full cash settlement...I recommend you to go AD cos you are covered with the factory warranty plus deposit risk free

 

PI using normal WS...so if something happens you might face issues with them

 

Unless the price difference is huge then worth the risk

 

But don’t forget that if PI WS can’t rectify issue arose then you have to fork out adoption fees to repair at AD

 

I got a Friend that bought PI benz save 20k but later he regretted:(

 

Because PI can fix the problems and adoption fee is higher than his initial savings

 

My 2 cents worth of advice: D

[DACH]

Yes the c&c se told me bank will charge penalty 2k for 1 year loan. Am considering to buy kia cerato, honda jazz/city/civic, hyundai elantra. Hence, asking the question. Like some bro said objective is to save on interest but if take a bit loan the cost savings can cover the interest, it's still worth considering.

Penalty of 2k for 1 year loan?

Then what's the minimum loan tenure in order not to incur penalty?

[Inlinefour]

Penalty of 2k for 1 year loan?

Then what's the minimum loan tenure in order not to incur penalty?

I think he is referring to early settlement penalty plus interest

[adrianty]

I think he is referring to early settlement penalty plus interest

Yes you are right. Early settlement penalty.

[singcheng]

I didn't know there is pi for the car models I listed above. What are the benefits of going through pi apart from no fee and normal freebies for no loan? Cause there is a risk of going through pi with deposit lost if it go bust.

 

I mean other model such as Honda Fit (PI)

[adrianty]

Anyone can advise if take loan, will the principal be paid down along the way or will remain same throughout the tenure?

[BobbyTan_74287]

Anyone can advise if take loan, will the principal be paid down along the way or will remain same throughout the tenure?

Principal will gradually reduce as you pay your instalment .

[adrianty]

Principal will gradually reduce as you pay your instalment .

Ok thks!

[Jasonlim1988]

Looking at all Singapore car loan. They charge interest on initial loan principle amount even when ur principle is left with $1.

Eg ;u loan 50k, 2% loa , 6 year loan .on the last month, u probably paid most of the principle and left with $1k loan.

They still charge 2% on 50k on last month.

 

How come MAS allow this kind of practice.

[Throttle2]

Looking at all Singapore car loan. They charge interest on initial loan principle amount even when ur principle is left with $1.

Eg ;u loan 50k, 2% loa , 6 year loan .on the last month, u probably paid most of the principle and left with $1k loan.

They still charge 2% on 50k on last month.

 

How come MAS allow this kind of practice.

Thats why full cash settle lor.

Car loans are non principle reducing.

So when the quoted rate is 2.5% , the effective rate is probably twice of that.

 

No free lunch lah.

Risky loan, more expensive

[Banz86]

I was looking for a replacement car and the PI told me there will be an extra $2k if I were to find my own loan or full cash the car.

 

The $2k is to make up their loss of rebates from the insurance companies. 

[Yippe]

Yes true, as mine paying full need to foot extra $2K, taken shortest load of 1 year lost $800, which one you choose. 

[BobbyTan_74287]

Looking at all Singapore car loan. They charge interest on initial loan principle amount even when ur principle is left with $1.

Eg ;u loan 50k, 2% loa , 6 year loan .on the last month, u probably paid most of the principle and left with $1k loan.

They still charge 2% on 50k on last month.

 

How come MAS allow this kind of practice.

This is rule of 78 - hire purchase rule since long time ago. i think 15 or 20 years ago, bank offers flexible interest rate which based on your outstanding amount. Then this practice is taken away and all bank used rule of 78 for Hire Purchase for car loan.  

[ntuc2018]

Looking at all Singapore car loan. They charge interest on initial loan principle amount even when ur principle is left with $1.

Eg ;u loan 50k, 2% loa , 6 year loan .on the last month, u probably paid most of the principle and left with $1k loan.

They still charge 2% on 50k on last month.

 

How come MAS allow this kind of practice.

 

This is the usual practice. Car is a luxury items. So they dun care. Like Credit card, interest rate is crazy but MAS also dun care cos if u can live without it, they ok.

 

Housing loan is not like that.

[KlarksonKightly]

If you intend to pay full cash settlement...I recommend you to go AD cos you are covered with the factory warranty plus deposit risk free

 

PI using normal WS...so if something happens you might face issues with them

 

Unless the price difference is huge then worth the risk

 

But don’t forget that if PI WS can’t rectify issue arose then you have to fork out adoption fees to repair at AD

 

I got a Friend that bought PI benz save 20k but later he regretted:(

 

Because PI can fix the problems and adoption fee is higher than his initial savings

 

My 2 cents worth of advice: D

Bro if I save 35k for a PI benz worth it or not?

[CYHew]

Looking at all Singapore car loan. They charge interest on initial loan principle amount even when ur principle is left with $1.

Eg ;u loan 50k, 2% loa , 6 year loan .on the last month, u probably paid most of the principle and left with $1k loan.

They still charge 2% on 50k on last month.

 

How come MAS allow this kind of practice.

Car loans come under hire purchase arrangement in which interest is charged on a straight line basis, ie. calculated upfront on the principal amount and allocated equally over the loan tenure of the principal repayment. In other words, the principal sum will not end up with $1 at the end of the loan period.

 

This is contrary to Housing loan which is considered as a mortgage loan, which banks apply reducing balance basis on loan repayment and thus you will see that the principal sum may end up with $1.

 

The above methodology is part of accounting concepts.

[Inlinefour]

Bro if I save 35k for a PI benz worth it or not?

 

Go Cycle to compare the spec before you decide