My experience buying used car with finance

[BestB]

Just doing this post as a guide of what i have experienced

 

Used car from a tent, have WP and credit history

 

So after some research, decided to get 2 year old used car with finance as terms offered was pretty good, 2.9% interest.

 

Tent and Bank insist must have Thai guarantor, even though i have bought a few cars under finance.

 

Once in the tent, filling out paperwork with lending officer from the bank, interest rate goes up from 2.9% to 4.79% because apparently 2.9% is only for Toyota or Isuzu

 

ALSO, must purchase car insurance through the bank, which basically means more expansive than if i was to use my broker.

 

10000 baht extra for the tent to transfer.

 

Ok, all agreed, provided all the paperwork from myself and thai guarantor , bank needs 2-3 days to process and verify

 

After 5 days, all approved and i am told my monthly installments, which most certainly did not sound as if it was 4.79%, yet tent and bank insisted it was 4.79%

 

Seeing as they struggle with maths, i used banks website calculator to show them that it was not 4.79%

 

This is where things took an interesting turn

 

As it turns out, insurance PA was added to the total price.

 

Do not ask what insurance PA is because i could not get a straight answer from anyone. in any language.

 

Some mumbling explanations included that if i fail to pay, then guarantor does not need to pay. So if thats the case, why would i need a guarantor?

 

Anyhow, this whole insurance PA sounded like the regular bank scam of need insurance to open account, so i simply refused.

 

Now, tent, in private admitted it was a bank scam, and lending officer want to sell this insurance as he gets commission.

 

I do not need to take out this insurance, AND  i will get 6 month interest FREE , but and big BUT, after that interest rate is 5.75%

 

So they advertise 2.9%, then bump you to 4.79% then try to scam you for some insurance and if you catch them out, then rate goes up again.

 

So moral of the story is if you buying with finance, make sure you confirm and double check what real rate and amount you are paying.

 

Also interest rate they quote EXCLUDES VAT, yes you must pay VAT on interest/monthly repayments. 

 

[Henryford]

I had a similar story when i tried to buy on finance. They quoted me one rate to get the deal but when i started to fill in the paper work the figures went up, with extra insurance etc. Told them to stuff their car.

[BestB]

40 minutes ago, Henryford said:

I had a similar story when i tried to buy on finance. They quoted me one rate to get the deal but when i started to fill in the paper work the figures went up, with extra insurance etc. Told them to stuff their car.

I do not think it’s the tent who is pulling this scam , I think it’s the bank  and the lending officers , as they get higher commissions for selling insurance. But still buyer be aware 

[DaRoadrunner]

Amazing Thailand! Never bought on finance myself. However, suspect your best way is to have your Thai wife negotiate the deal.

 

What's to stop you arranging your own finance direct with a bank or finance co' of your choice?

[BestB]

1 minute ago, DaRoadrunner said:

Amazing Thailand! Never bought on finance myself. However, suspect your best way is to have your Thai wife negotiate the deal.

 

What's to stop you arranging your own finance direct with a bank or finance co' of your choice?

Not sure how wife would get a better deal but unlike back in the west banks do not do car loans with individuals only

through a tent or a dealer. Not all banks do car loans and even less banks do second hand car loans, I think only 3 banks do.

 

you do fill out all the paperwork direct with the banks lending officer, selling insurance is part of their job as well.

 

its similar scam to branch demanding you take out some insurance in order to open a bank account for you . 

 

Can not comment on why interest rate keeps changing as it’s a mystery to me as well

[stevenl]

% always seems low here, but it is calculated on the full amount for the full term. So a low Thai percentage would in the west result in a much higher APR.

[watcharacters]

 

 

Good for you that it worked out in the end.

 

I think I'd have let my feet do the talking for me as soon as I felt a bait and switch in the making.

[BestB]

15 minutes ago, stevenl said:

% always seems low here, but it is calculated on the full amount for the full term. So a low Thai percentage would in the west result in a much higher APR.

Hmmm no it’s not. It’s applied on borrowed amount and can be repaid earlier either with a discount on total interest or whatever outstanding is on the day of settlement. 

[BestB]

Just now, watcharacters said:

 

 

Good for you that it worked out in the end.

 

I think I'd have let my feet do the talking for me as soon as I felt a bait and switch in the making.

To be honest even though they advertised 2.9%, I did not expect for that to be true. I was happy with 5%, what pissed me off was the added insurance which made no sense and without my knowledge or explanation.

 

when I got angry and was ready to walk, interest went up again, but then 6 months interest free was given and no insurance and funny enough repayments with higher interest are less than with lower interest but insurance added. 

 

Scam? Stupidity? Incompetence? I have no idea but thought would be good idea to warn others and always check if repayments match the interest rate on the borrowed amount.

 

if I did not do my own calculations , I would of had some insurance added and I would not have even known about it even after the fact

[stevenl]

1 hour ago, BestB said:

Hmmm no it’s not. It’s applied on borrowed amount and can be repaid earlier either with a discount on total interest or whatever outstanding is on the day of settlement. 

Yes, it is. You're saying the same as what I said, " % always seems low here, but it is calculated on the full amount for the full term. So a low Thai percentage would in the west result in a much higher APR. ", except that I did not mention early repayment.

[transam]

2 hours ago, BestB said:

Hmmm no it’s not. It’s applied on borrowed amount and can be repaid earlier either with a discount on total interest or whatever outstanding is on the day of settlement. 

All credit agreements here have an early repayment clause. It usually states that if you want to pay the loan off early you must pay a minimum of 50% of the total interest for the agreed period...Way different to farangland..