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How Does POSB Car Loan Singapore Works?

Possessing your dream ride has always been tedious. Paperwork and money matters take time to process. Good thing an Auto Loan is now available. 

POSB Singapore is one of the top-tier banks in the country, offering several banking services suitable for anybody’s financial needs. Among all products, POSB Car Loan is the most acquired loan product. It is a straightforward and affordable loan you might want to try. 

Before anything else, let’s find out how POSB Car Loan works.

POSB car loan

Amazing Benefits of POSB Car Loan Singapore

POSB Car Loan finances any vehicle type you like. Here are some reasons why it is advantageous to apply for one. 

  • Reasonable Interest Rate: Auto loan by POSB provides a fixed interest rate of 1.99% per annum. The rate is generally relatively higher for used cars. 
  • Extended POSB Loan Tenure: Regardless of whether your chosen car is new or used, the loan term ranges from one to seven years. 
  • Maximum Loanable Amount: An applicant can borrow a loan amount based on Open Market Value (OMV). Yes, it’s not based on the car purchase price. With POSB Car Loan, borrowers can take up to 70% of the car price. It applies if the OMV is equal to or below $20,000. But if the OMV is more than $20,000, applicants can only borrow up to 60% of the vehicle price. 
  • Applicable for New and Used Cars: POSB Car Loan finances for both new and used cars. Be mindful that used cars must be less than 10 years of age. If more than that, the car is not eligible for financing. 
  • Easy to Use Car Loan Calculator: POSB is notable for its loan calculator, helping borrowers to generate a realistic figure for their monthly repayments. Input the basic details such as the loan amount, interest rate, and tenure. Once the information is in, it calculates an estimated amount for your monthly financial obligation. 

It is understandable why the majority take out an auto loan from POSB. The features are excellent for everybody’s financial situation. Also, it aims to help you achieve the car you’ve been eyeing for so long. 

Who are Eligible Applicants for POSB Car Loan?

Borrowers who aspire to take out a POSB Car Loan must have an existing POSB or DBS account. 

Suppose you are one of them; log in with your existing Digibank ID. It automatically prefills your relevant personal information. 

For SingPass holders, access your personal and income details through MyInfo. Review and check for any changes or discrepancies. Or you may manually enter the necessary information. 

Also, eligible applicants for a POSB Auto loan must meet the following criteria. 

Age Limit Requirement

Applicants should be at least 21 years old or older to become eligible. 

Borrower’s Residency

Qualified borrowers can either be Singaporeans or Singapore Permanent Residents. A foreigner can apply as well as long as he/she fits with other criteria. 

Required Monthly Income

Another factor for applicants to consider is their minimum monthly income. Singaporeans and Permanent Residents must earn at least $2,000. Meanwhile, foreigners must at least have $4,000 for their monthly take-home earnings. 

It is essential to assess yourself first to see whether you’re fit to apply for a POSB Car Loan or not. Remember, the bank provides financial aid for your car purchase. 

What are POSB Car Loan Income Requirements?

After identifying yourself as an eligible applicant for a POSB Car Loan, prepare all the essential documents. 

For Singaporean and Permanent Residents

Suppose you belong to this group, ready a photocopy of NRIC (front and back) and documents that indicate your income. It can be any of the following:

  • Computerised payslip (latest)
  • IRAS Notice of Assessment (latest)
  • CPF contribution history for the last 12 months

If you’re self-employed, the IRAS Notice of Assessment must be for the last 2 years. 

If you earn a rental consideration, provide a copy of the Tenancy Agreement. But it must be on top of the required income documents stated above. 

Provide additional documents if you previously purchased a car. The Vehicle Statement Agreement and LTC vehicle log card must be present. 

For Foreigners

Suppose you’re a foreigner staying in Singapore and need an auto loan. Ready a photocopy of your Passport and Employment Pass (front and back). Take note that it must be at least 6 months of validity. 

POSB requires Malaysians to present a copy of the NRIC, too, on top of the requirements above. 

Also, prepare any of the following income documents. 

  • Computerised payslip (latest)
  • IRAS Notice of Assessment (latest)
  • CPF contribution history for the last 12 months

If you’re self-employed, the IRAS Notice of Assessment must be for the last 2 years. 

If you earn a rental consideration, provide a copy of the Tenancy Agreement. But it must be on top of the required income documents stated above. 

Provide additional documents if you previously purchased a car. The Vehicle Statement Agreement and LTC vehicle log card must be present. 

Make sure to complete these papers before proceeding with your loan application. Duly accomplished POSB Car Loan Income requirements lead to a faster and more convenient process. 

Importance Of POSB Car Loan Calculator

A loan calculator always comes in handy, which helps borrowers to:

Predict Loan Amount

It is the best tool for helping applicants have a gist of the loan amount they can borrow. You can grasp which vehicle is probably suitable for your finances. 

Estimate Monthly Due

Loan repayment is more manageable with a POSB Car Loan Calculator. You can easily foresee if you can handle your future monthly obligation. Also, you can identify if it can affect your daily needs. 

Furthermore, the POSB Car Loan Calculator has two types. The first one calculates the maximum loan amount you can borrow. You will know how much cash you need for the downpayment. If the loan amount is lower than what you need, look for other types of loans. 

Meanwhile, the second one computes your monthly instalments. You can easily distinguish if you can handle the estimated monthly repayment. Weigh your options if you’ll go through with it or not. 

Utilising a loan calculator is a wise decision whenever you apply for a loan. It estimates all your possible expenses. Although inaccurate, it gives you a bright idea of your future finances.

POSB is truly a trusted bank in Singapore. It gives out loans based on the financial situation. Buying a car with POSB Car Loan is one of the best financial assistance available. 

Be financially prepared when buying a car.

Getting a car loan from POSB is one big help for those who can’t afford to buy in cash. But note that even if you take a car loan, you still have to pay the down payment in cash. 

Prepare 30% or more for the down payment. The higher the down payment, the lesser the loan amount you need to take. Before you decide to get a car loan, be sure that you already have the cash for the required down payment.

It’s convenient driving your own car. You won’t stress yourself by commuting in public, especially when your home is far from your working place. Rain or shine, you’re ready to go anywhere, anytime.

Aside from car loans, POSB offers other loan products, such as personal loans. Such a loan product is flexible. If you wish to have extra money for your child’s education needs, consider POSB Education Loan. 

Besides POSB, if you wish to get a short-term cash loan, consider getting it from reputable moneylenders like Cash Mart Singapore. Aside from low-interest personal loans, you can also get payday, business, renovation, and foreigner loans. 

Visit Cash Mart Singapore to discover more!