@gv991 I doubt if 5% is the per annum rate. The cost of funds is around 2% so this just leaves 3% to cover other expenses (employee salary/benefits, utilities, providions for loan losses etc) which is not enough. I suggest that you get your loan disclosure statement and look up your effective interest rate so you'll know what it actually costs you to get that car loan. I'm guessing its around 15-20% per annum.
@momenezes Hi, I was referring to simple interest vs effective interest rate. Effective is actually quite high like you suggested. I like simple interest rate because i can compare easily if i should leverage vs pay in cash. I think OP is referring to simple interest as well because it would be too low for effective.
@gv991 Noted po. Pero ang simple interest po kasi now only serves a a marketing tool dahil nga mas mababa sya sa effective rate. Kaya ang mas relevant na itanong nyo sa bank loan officer is ano ang effective rate. Alam napo nila yan kasi madami naman na nag-avail ng car loans before your application. Kung alam mo na ang effective rate, mas magiging reliable ang decision mo sa pagpili ng lender.
@mgrennell If its a first time car buyer, there is a compelling argument to buying a brand new one. Sure ka na good condition and its the latest and greatest version of the model you want.
And with the hellish public transpo situation, I wont want to wait 2.5+ years to buy a car.
Sometimes the immediate comfort is worth the little financial setback.
@howardrf Window shop first sa mga banks. PSBank and Metrobank usually offer lower interest rate. Lalo na yung mga bagong bukas na mga branches of banks, active maghanap ng clients yan.
