What bank has the best interest rate for car loan? and why do they have different terms for the interest?

[i.Bobot]

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Istoryans,

I'm posting this to ask help from you all as we have plans to avail a car loan. Along my research , i found some interest rates but with different terms. For instance, UNIONBANK has the Add-on rate while BPI has "in arrears" and "in advance". My goal, ultimately, kay madetermine ug kinsa among sa tanan banks ang naay pinaka ubos ug interest rate.

Thanks guys.. please take time to advise.

[spartan301]

Add-on rate - most expensive way.. Basically interest is based on the original amount of the principal...
In arrears - payment is at the end of each month.. Slightly more expensive than in advance
In advance - payment is made at the beginning of each month/ amortization...

If budget permits it, i suggest you pay the car in full, then have it refinanced with a bank... This way, the bank will no longer pass-on to you the "dealers incentive". Also, choose the "in-advance" method of collection. This should slash a few more percent in your rates.

Now as a matter of industry practice, car loan interest rates are fixed for the life of your amortization. However, im not sure about the smaller banks (ex. Ps bank) so just ask em... If some banks will offer 1 yr fixing, 3yrs or 5 yrs, the shorter, the cheaper, downside we can never tell if rates will shoot-up on your 2nd year on-wards...

Personal advice: avail asap... Interest rates will go-up by next year simply because it cant go any lower... Bpi..

[i.Bobot]

Add-on rate - most expensive way.. Basically interest is based on the original amount of the principal...
In arrears - payment is at the end of each month.. Slightly more expensive than in advance
In advance - payment is made at the beginning of each month/ amortization...

If budget permits it, i suggest you pay the car in full, then have it refinanced with a bank... This way, the bank will no longer pass-on to you the "dealers incentive". Also, choose the "in-advance" method of collection. This should slash a few more percent in your rates.

Now as a matter of industry practice, car loan interest rates are fixed for the life of your amortization. However, im not sure about the smaller banks (ex. Ps bank) so just ask em... If some banks will offer 1 yr fixing, 3yrs or 5 yrs, the shorter, the cheaper, downside we can never tell if rates will shoot-up on your 2nd year on-wards...

Personal advice: avail asap... Interest rates will go-up by next year simply because it cant go any lower... Bpi..

Boss Spartan,

This is very helpful.Thank you so much. Would you please mind to expound more details about the "dealers incentive"? We are planning to avail a hyundai unit. It seems to me that, the discount they are offering (45K) off of your down payment will be charge to your financed amount. In effect, really , there is no discount at all.

In addition boss, kong ako ifull payment then irefinanced nako ang sakyanan, how long would it take man pud boss for the bank to pay me the money( assuming approved ko sa loan)? Ako man gud plan is manghulam rako ako parents sa kulang then pay them kong mo hatag na ang bank.

THanks ayo boss..

[spartan301]

Boss Spartan,

This is very helpful.Thank you so much. Would you please mind to expound more details about the "dealers incentive"? We are planning to avail a hyundai unit. It seems to me that, the discount they are offering (45K) off of your down payment will be charge to your financed amount. In effect, really , there is no discount at all.

In addition boss, kong ako ifull payment then irefinanced nako ang sakyanan, how long would it take man pud boss for the bank to pay me the money( assuming approved ko sa loan)? Ako man gud plan is manghulam rako ako parents sa kulang then pay them kong mo hatag na ang bank.

THanks ayo boss..

THe discount is real... you wont just feel it since you'll be amortizing your car payment...
Nway, to your question... Car dealers will refer you to their "preferred or partner bank" because these banks process a lot quicker, and they can be paid in full already.. In return for the client referal, the banks will give these car distributors the "dealers incentive"... quick approval means, quick release for your dream car... everybody happy... hehehe

On your 2nd question, dali ra na ang pa refinance if approved nka daan in the first place... (1 week at most)... the refinance thing is just an option... the important thing is you're approved of a loan for this much and for this long...