Car Loan Requirements
Before you apply, do you want to know what are the car loan requirements for you to be approved?
Keep reading here and we will go through them one by one, so you can be better prepared for your car loan application, and have the best chance of being approved.
You don’t have to wish and pray that your rich Tito will hand you the keys to his second hand Honda when he upgrades to the new model.
Car loans in the Philippines make it easier to drive the car you want today, and repay that same car in bite sized chunks every month.
Having to save up Php800,000 or Php1million plus for a car is mostly not possible,in this day and age living inside the Philippines.
There’s two types of car loan requirements that you need to know about.
- Your personal requirements.
- You must be 21 years or older at the time of your application.
- You must be 65 years or younger on the day that your car loan will finish.
- Philippine citizens can apply.
- Permanent Philippine residents can also apply.
- If you are not Filipino and are not a Permanent Resident of the Philippines, you can not apply.
- You will need to provide government issued photo I.D as well as proof of your home address.
- Your financial requirements.
- Your monthly salary should be Php30,000 or more.
- You will need to provide proof of your salary and proof of your employment.
- You will need to be a regularised employee and have a tenure of 12 months or more.
- If you are self employed, your business should have been profitable during the last financial year (you will also need to provide audited papers).
- If you have previous defaults in the last 3 years officially marked against your name in the Philippines, you will not be able to avail a car loan.
Secured Car Loan
Another requirement of some car loans that is not often spoken about, is the need for a ‘secured car loan’ over a ‘unsecured car loan’.
The lending company who will provide you the loan, will be the one to decide if your car loan is going to be secured or unsecured.
If your car loan needs to be secured, this is another requirement for your car loan. Below is how it works.
How to Do Secured Car Loans Work?
The bank or lending company you are getting your car loan from will provide you with the car loan, if you agree that the car itself can be taken from you (know as “repossession”), if you continually do not make your repayments for a continued and long period of time.
This is a agreement that you and the car loan lender will sign and agree to before your car loan is issued to you.
Therefore technically, your lender holds official rights to your car until the car loan is paid off in full. However, you of course get to drive and house the car 24/7.
Secured car loans are very normal, and they are not necessarily something you need to avoid – of course the lending company has these rights if you do not repay.
NOTE: This does not mean that your new car will be taken from you, if you are unable to make one payment, or if your payment is late one or two times over the life of your loan.
This is simply just some extra security that your loan provider will hold “just in case”.
These are the basic requirements for car loans in the Philippines. There is a chance that you may need to provide one additional form of I.D, or one additional letter from your employer.. Just for example.
The next step is to find out if you are approved for a car loan, you can apply now on this page.