Buying a car is a decision that many people eventually consider. This is especially true for those who find the local commute to be a frustrating challenge to undertake. Generally speaking, it is also because cars provide so much utility to a given person. However, buying a car is not a simple thing to do given that they are expensive and require a lot of financial planning. This is where companies that offer 2nd hand car financing payday loans in Connecticut in the Philippines such as Asialink Finance Corporation, can help because they provide financial solutions and instruments that help people.
Given the increasing prices of brand new cars in the market, whether it’s due to inflation or new tax policies, 2nd hand cars are becoming the better option. Knowing why they are better can help you make better investment decisions in the future. That being said, here is what you need to know.
Loan providers compete for low-interest rates
Both banks and finance companies can provide varying terms for 2nd hand car financing in the Philippines. For example, the interest rates that banks offer on one to four-year loan terms are usually around .93% to 2%. In contrast, non-banks such as finance companies that offer one to three-year loan terms are around 1.25% to 1.30%.
This kind of set-up benefits you because it provides you with choices. There is usually an optimal choice amongst a given set. Typically, the difference-maker is the processing time and leniency when it comes to the approval of your loan application. Asking around can be your best bet to find out which option offers the fastest processing time or which is the most lenient.
Important requirements you need for a 2nd hand car loan
Here are some of the most common and important requirements you would need to apply for 2nd hand car financing in the Philippines.
Copy of OR/CR and Deed of Sale
The three documents are necessary because it proves the identity of the actual owner of the property along with all the other necessary information regarding legalities and obligations. While the deed of sale isn’t signed until both parties in the transaction are satisfied, a draft needs to be presented to verify that the transaction is legal and done in good faith.
The last thing loan providers would want to do is to finance an illegal transaction or any other type of complicated deal.
Proof of Downpayment
The next requirement you would need is proof of downpayment. A downpayment is usually (but not always) required when it comes to loans. If your chosen loan requires one, you would have to provide sufficient evidence that you can pay for it.
This usually comes in the form of bank statements and/or money market accounts. If these show or contain enough money to cover the down payment, you should be good. But sometimes, loan providers require that you also have enough to pay for the first few months of installments.
To be on the safe side, it is best if you save enough money to pay for the down payment as well as the first few months of payment. This should make you more credible in terms of financial capability and would improve your chances of getting approved for a loan.
Documented Proof of Income
Aside from your proof of downpayment, you should also prepare a documented proof of income. There are many ways to do this, but one of the most common methods is by crafting a letter.
This letter summarizes your history of employment and income, and can be written by you, your employer, accountant, or even a social worker depending on your circumstances.