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New year is just round the corner, and it’s time to start planning your new year resolutions. If buying a car is on one of your lists, here are eight tips or resources which may help you to own the car of your dreams!
Before we begin, it’s advisable for you to take some time to survey on the types of cars you are planning to buy, as it’ll link to your car loan process. Shall we start?
1 – Who can apply for a car loan?
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Anyone that is 18 years and above, sole proprietorship, partnership, private and public limited companies are eligible to apply for a car loan. However, you will need a guarantor if you do not have any fixed source of income while applying for the loan.
2 – Are you getting a new or a used car?
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Majority of banks have higher rates for used cars, since they have a lower resale value, and cars’ (value) depreciates fast. Certain banks will also set up a vehicle age limit as a guideline to assist buyers for purchasing a used car.
3 – Buying local or international?
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Top priorities are given to buyers of our national cars like Proton, however there’s only a small difference in the interest rates.
4 – Planning for insurance or Takaful Coverage?
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It is compulsory to have either an insurance or Takaful coverage until your car’s loan is fully settle. There are a number of companies in Malaysia that offer these services.
5 – Late payment charges
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Should you have forgotten to make your car loan payment on time, there will be a late payment charges of 3% onward, depending on the amount and tenor. As for the outstanding balance, an 8% P.A interest will be imposed by the bank.
6 – Bank’s repossession of your car
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A warning notice will be issued by the bank if you fail to make 2 ‘successful’ default repayments. The bank will proceed to reposes your car after a certain period, and should that happen, you may still pay for the outstanding amount to get your car back, if not, the bank will sell or dispose it (your car) via public auction or private sale.
7 – How long is your tenure?
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A lower interest rate is given to cars with longer tenure from the bank. But, there are selected banks which are offering a rebate on an early settlement.
8 – Fresh graduate schemes
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Some banks are offering schemes or packages for fresh graduates below the age of 30, with a minimum of a Diploma or Degree. However, the interest rates will be higher because there is a higher financial risk that the bank is taking: will the fresh graduate able to find a job, are they able to pay the minimum repayment, etc.
Whatever your choice of car or the loan process is, spend sometime to survey and understand the pro and cons. It is advisable to seek professional advise from banks or consultants as they may customized something that suits your lifestyle and financial needs.
Once you know what you know, head on to the largest online marketplace to scout for your next car!