How does financing works?

[newbie_123]

Hi, I'm not sure if anyone has posted a topic like this but I hope you could [SIZE=-1]give me some insi[/SIZE][SIZE=-1]ghts re[/SIZE][SIZE=-1]gardin[/SIZE][SIZE=-1]g financin[/SIZE][SIZE=-1]g on cars.

example: a car that's worth 325K...how to finance it? downpayments? installments?
[/SIZE]

[1D4LV]

financing will only pay a certain percentage of the market value of the car. the standard i think is 80%. so in your example, at P 325,000, the bank or the financing institution will only pay Php 260,000, so you need to cough up the additional 20% to get the car.

not only that, banks and financing institutions will only allow you to get a certain model (year) of the car. the standard i think is three years, so if you will get one now, the earliest model you can get is model 2003 upwards.

the 260,000 that you've loaned is payable for a certain number of years. may computing factor sila dun on how much you pay monthly.

and you have to pay for the "mortgage" fee, which is outside of the loaned amount. i think it costs around 10,000 to 12,000 pesos depending on the location of registration and the value/make/model of the car. this ensures that you cannot sell the car while you are still paying for it.

and of course, they will require you to have a comprehensive insurance. the rate of compre insurance differs from one company to one company and to the value/make/model of the vehicle.

hth.

[yebo]

yup, meron chattel mortgage fee and comprehensive insurance added over the price of the car. the chattel mortgage fee is a percentage of the amount financed. the bank can add the chattel mortgage and insurance to the amount financed, or they can also ask you to add that to the down payment (the usual case). so ang total money out mo will be downpayment + chattel mortgae fee + comprehensive insurance + registration fee.

most banks ask for 40% downpayment for a used car. it can be as low as 10% downpayment for a brand new car. also some banks (psbank, union bank) allow financing on used cars that are 5 years old, sometimes older depending on the condition/model/make of the car. just ask around, most philippine banks have email addresses in their websites where you can inquire and get more details.

after you have fully paid for the car you will also have to pay for the cancellation of chattel mortgage. usually the bank does this for you and you just have to pay them when you get the original copy of the OR/CR from them.

[uls]

basically, the bank lends u money to buy a car. Not the full amount but just part of it.

U pay the loan in monthly installment.

the bank hangs on to ur OR/CR until u have paid off the loan.

If u stop paying or miss payments, the bank can legally take the car from u and sell it.

[jonski]

didnt understand ***t!

any hot pinay willing to translate this to tagalog to this poor filipino? i'll pay my tuition with love...
interested? dial 1-800-JONSKI