Why are Finance Minister and Transport Minister not plugging the loopholes for car loans?

[Jacy_Phang]

You will be surprised how many people ended up going for this. I was like you previously until I realised the number was much higher than I thought.

TS friend must have brought a 2nd hand car yet still go for full loan (brand new car the coe oredi near 100k n above)...these r the types that " dont own car will die"..super high interest 4% n above? N need to pay till 10th year.. PI loved these type of suckers cos interest earned is damn chor..meaning their comm also chor..

 

[kingmaker888]

The max 60/70% over 7yrs rules only applies to Hire Purchase... which means u own the car after complete repayment...

Those 100% are more of a 10yr lease... u dun own the car at all...

Technically u own it in yr name once lta transfer is done, can even put under own company. But bank will own the car

 

[jonleelk]

AD can also offer 100% loan. Not sure is it packaged under "lease".

U just check any PI facebook page. Many asking 100% loan for new car for PHV usage. Whether they really drive PHV or not don't know.

 

[Foetid]

The max 60/70% over 7yrs rules only applies to Hire Purchase... which means u own the car after complete repayment...

Those 100% are more of a 10yr lease... u dun own the car at all...

It operate just like HDB I guess, leasing instead of ownership, anytime can return without losses then? Don't need to maintain??

 

[SuperGreenHorn]

dont jelly la

What makes you think so?

 

[SuperGreenHorn]

It’s complicated

Cos there are many scenarios and obviously I never think of all of them

The loan is NOT a car loan. It’s a personal loan. It’s just a coincidence u use the money to buy the car. Should it be controlled? One day u no money and need to borrow from licensed money lender and they say sorry the law says cannot, go to bank poor credit risk so no loan, go to friend and friend say sorry no cannot cos as per edmw, all loans are to be regulated so please apply through your MP…. U want?

Second is u don’t own the car. The car is in the company’s name and u leased for 10 years. What’s so illegal about that?

and so on.

This is what I meant by loopholes. As long as the car is a collateral, you cannot call it anything else. Our Ministry of Finance can't be so easy to circumvent one right?

 

[SuperGreenHorn]

In house loan is it

Why is MOF and MAS not regulating this?

 

[RedEyesFan]

- nobody die yet
- **** hasn't hit the fan, but the **** is there

 

[nasfieldjohn]

Monitorin like million dollar hdbs

 

[Eliwood]

Moi friend just bought a car for 100k, he was able to take out full loan of 100k for the car and loan till the final month.

I was told this is a very common practise amongst car buyers, car rental companies who bought new PHV vehicles are also able to loan the full amount of the price of the car and stretch the loan for 10 years.

I thought MAS stipulated that car loans are supposed to be up to 60-70% of the value of the vehicles and max loan term is 7 years?

Why are such financing loopholes allowed? Can the Finance Minister and Transport Minister please stop monitoring and make everyone follow the rules?

Wats ur beef with this first?

 

[fortunecat]

How does this affect TS?

 

[Spirax]

There is a catch, car company can seize back the car anytime if they claim car are not in proper care condition or facing bankruptcy

 

[RinoaX]

It generates GDP why bother clamping it down? When the bugger default it's ok, the car will go to the next dumb person to continue generating gdp.

 

[herzberg]

Close loophole liao then will lose income from coe, oil tax, road tax and taxes from car dealers leh. You want gst to upz moar to make up for these shortfall??

 

[socratesg]

Moi friend just bought a car for 100k, he was able to take out full loan of 100k for the car and loan till the final month.

I was told this is a very common practise amongst car buyers, car rental companies who bought new PHV vehicles are also able to loan the full amount of the price of the car and stretch the loan for 10 years.

I thought MAS stipulated that car loans are supposed to be up to 60-70% of the value of the vehicles and max loan term is 7 years?

Why are such financing loopholes allowed? Can the Finance Minister and Transport Minister please stop monitoring and make everyone follow the rules?

LOL this has been ongoing for many years ever since PHV flooded the market.

That's why you see so many new cars all the time with PHV stickers. Likely these are bought with 100% loan for "private" use instead of fetching passengers. They just need to fetch a few customers per month to meet min quota. Wayang abit can liao.

Of coz the authorities know. They just close one eye coz if clamp down on this, then demand for new cars jitao sky dive and will cause COE to plummet. COE is instant cash cow, why destroy it ??

 

[fulaien]

"We are monitoring"
"These are isolated cases"
"Only x% do that, it is not widespread"
"Rest assured"


Choose 1 or more of the above

 

[Evil_Boss]

Moi friend just bought a car for 100k, he was able to take out full loan of 100k for the car and loan till the final month.

I was told this is a very common practise amongst car buyers, car rental companies who bought new PHV vehicles are also able to loan the full amount of the price of the car and stretch the loan for 10 years.

I thought MAS stipulated that car loans are supposed to be up to 60-70% of the value of the vehicles and max loan term is 7 years?

Why are such financing loopholes allowed? Can the Finance Minister and Transport Minister please stop monitoring and make everyone follow the rules?

these are bank guidelines not car company guidelines mah

 

[Dividends]

A $100k 10 years loan with rates of about 3.8% mentioned in the other thread, they'd be paying $38k just in interests alone by the time they've finished paying up the car.

 

[wongkc]

Technically u own it in yr name once lta transfer is done, can even put under own company. But bank will own the car

Added the word "fully" own... for better understanding...

 

[PaulLevesque]

I believe they're monitoring first before coming up with the best solution