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

[SuperGreenHorn]

Therefore, those offering 100% loans are usually taking loan from the dealer's in-house financial arm or partners. These are not governed by the Hire Purchase laws.

Is this the crux of the problem? Why is Ministry of Finance allowing a loophole like this to circumvent their rules?

 

[elephantscannotfly]

You tell them go and plug crazy COE prices first lol.
Besides, its not the banks that are giving the 100% loan, how is it their problem?

 

[louisoh]

TS jelly your friend got car?

arbo y u huanlo.. not like if he can't pay, u need to help him pay. LOL

 

[Tuckie]

Wow. Mas doesn't regulate non bank licensed money lenders??

So let’s say I lend my friend money, mas should regulate me?

 

[Tuckie]

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.

Exactly… you cannot control what constitutes “lending”

 

[Unic0rn]

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 rampant practice 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?

If not, how do singaporeans afford their own car?

 

[glarerder]

So let’s say I lend my friend money, mas should regulate me?

Non bank licensed money lender is not a friend.

 

[swenson]

Is this the crux of the problem? Why is Ministry of Finance allowing a loophole like this to circumvent their rules?

We cannnot expect the govt to control EVERYTHING.

On the other side of the coin, these coys will say that banks and financial houses control all the monies and will affect their business. They need to MOVE vehicles (new or pre-owned) in order to stay alive.

govt only step in when things goes spiral out of control. Right now it is earning big bucks for their COE coffers so there is no need to step in

 

[ceestudent]

People dare to take loan with higher interest rate, you all care for what?
They do it with open eye without anyone pointing gun at him mah.

 

[swiftblade]

Many phv drivers in here defending the loophole

 

[SuperGreenHorn]

We cannnot expect the govt to control EVERYTHING.

On the other side of the coin, these coys will say that banks and financial houses control all the monies and will affect their business. They need to MOVE vehicles (new or pre-owned) in order to stay alive.

govt only step in when things goes spiral out of control. Right now it is earning big bucks for their COE coffers so there is no need to step in

If cannot regulate properly then why regulate at all?

 

[Philipkee]

If cannot regulate properly then why regulate at all?

People will always find loopholes

 

[swenson]

If cannot regulate properly then why regulate at all?

Too many scenarios of allowing 'buyers' to buy a car without dp

I pay 100% to buy. I sell to my friend and charge him 5% over 10 years. Car still under my name or I draft a contract that if fren missed payment to me for 2 months, I have the right to seize the car + losses
Govt control me?

Now If I buy 2 or more cars and to the same thing. How?

I start a company and to do the same thing. How?

Taxi companies are basically the same, except that they rent out their vehicles

PHV companies are like taxi companies, except have choice of rent or selling the vehicles with same condition as above.

Leasing companies also similar to PHV concept with a few tweaks here and there.

The housing1% 99% ABSD is a fine example of rules/laws are there but humans are always looking for loopholes to go around it.

That is where the difference lies.
For houses, govt is losing out on the additional duties so they will want to claw back --> will take action

For cars, its the banks and approved financial houses that lose out on the business, not the govt.
The loss in potential corporate taxes will be covered by gains from those in-house finance houses
They still earn obscene amount from COEs.

Closing this loophole will result in lowering demand -> lower COE --> why take action?????

 

[kingmaker888]

Many phv drivers in here defending the loophole

Not really

 

[perfectlight]

everything want gov control then control le u not happy

 

[Mclairs83]

he wan face more than anything else.

 

[Itsnotfunny]

Agree that rental companies can lease out the vehicle to drivers and ask them to pay monthly without deposit or down payment.
Only problem i see is that the COE is bidded using the driver name and ID. So why COE belongs to driver and car belongs to rental company? Is this what the COE system is built for ?

 

[Tuckie]

Non bank licensed money lender is not a friend.

If let’s say u go to this money lender and say I want to borrow 200k, will they lend u?

 

[blurredprint]

Those yolo with 100% financing really have no clue how much interest they are paying...

Don't think garment can really control without getting complains from both dealers and the buyers

 

[SuperGreenHorn]

Closing this loophole will result in lowering demand -> lower COE --> why take action?????

If we have a government that does the right thing, don't you think closing financing loopholes vs COE prices should be taken as 2 separate matters?

Won't you have a very bad opinion of your government if you think that they deliberately have a sinister plot to allow loopholes to circumvent the Hire Purchase Acts so that they could allow artificial demand and people who cannot afford cars to push up the demand and drive up COE prices?