Car Loan - What options do I have?

[Katsura]

Hey everyone, this is my situation:

 

• I want to buy a second hand car in the 500k - 1M baht range
• I have enough cash to pay for it but I'd rather get a low interest loan if possible
• I have regular income coming from abroad
• My Thai wife currently doesn't have a job but she has substantial savings 

 

Where could I get a better loan, at the dealership or at the bank? 

 

Any recommendations for banks?

 

Will they accept my foreign income as proof of income?

 

Will they accept my wife as a guarantor even though she doesn't have a job?

 

I've also found an interesting loan that my bank offers (Bangkok Bank) called "Deposit Pledged Personal Loan" which would give me a low interest rate loan if I use my savings as collateral. Does anyone have experience with that type of loan? 

 

 

Cheers

Edited December 2, 2021 by Katsura

[Kwasaki]

All you can do is go to a secondhand dealership and see if they will arrange a loan for you. 

 

It would be better if you brought new with a loan, on secondhand cars the best deal is to buy cash. 

 

High interest rate on s/h cars. 

[Henryford]

Just my recent experience at dealerships. Found it impossible to get finance as a farang, especially with no working thai as a guarantor, even though my foreign income is more than enough. I didn't try banks but i suspect they are the same. In the past i have gotten loans from my UK bank and just transferred the money here. I can borrow in the UK for 3.0 % APR, here it would be 6-10%.

Edited December 2, 2021 by Henryford

[CharlieH]

30% deposit wifes name, doubt you"ll hit a problem at most main  dealers or elsewhere.

[Katsura]

1 minute ago, CharlieH said:

30% deposit wifes name, doubt you"ll hit a problem at most main  dealers or elsewhere.

Do you know what interest rates I could expect? 

[CharlieH]

Just now, Katsura said:

Do you know what interest rates I could expect? 

No, but it wont be anything like you may be used to and will be substantially higher, in most cases.

Also bare in mind any in interest is loaded at the FRONT, so there is absolutely no benefit to pay it off early. (Usually)

[CharlieH]

One other point, dont think you can negotiate much if any of a discount for "cash" they actually want and prefer finance because of the ridiculous interest rates they can get away with. 1% per month as an example.

 

[Kwasaki]

9 minutes ago, Katsura said:

Do you know what interest rates I could expect? 

On new cars loans arranged are very different with deposit there some 0% ones on some vehicles.

 

You need a much bigger deposit on a secondhand to make worth while or you you just might as well buy new. 

 

Loans on s/h can 19% interest or more depending on how many years you want to pay over. 

 

If you make inquiries you will be able to decide yourself what's best. 

[Sophon]

Be aware that the interest rate you will be quoted on a used car loan is most likely calculated as "simple interest" - not compound interest. In practice that mean that when calculating the interest they are using that rate on the full loan amount for the full time of the loan. So if you get a loan of e.g. 500k at 5% interest to be paid back over 5 years, you are paying in total 500k*5%*5 = 125k over the five years of the loan.

 

Roughly speaking the simple interest rate equates to the double in compound interest rate (which we are more used to), so a 5% simple interest rate is in reality more like a 9-10% p.a. compound interest rate.

[DrJoy]

You can get loan if you hold Permanent Resident Card

[Chongalulu]

Don’t confuse the interest rate they quote you with APR you might get quoted in say UK. They are charging you the quoted % rate on the FULL lump sum over the entire period even though you are paying down that lump sum every month and later on in the payback period you’ll have paid back the majority of that capital loan but still paying interest on the initial sum. As others have mentioned this effectively doubles the quoted rate. 

[itsari]

7 hours ago, Henryford said:

Just my recent experience at dealerships. Found it impossible to get finance as a farang, especially with no working thai as a guarantor, even though my foreign income is more than enough. I didn't try banks but i suspect they are the same. In the past i have gotten loans from my UK bank and just transferred the money here. I can borrow in the UK for 3.0 % APR, here it would be 6-10%.

Obviously you have assets in the UK for managing a loan at that interest rate  from the UK .

Many Uk residents have to pay far higher interest rates on car loans for example . 

 

[CrunchWrapSupreme]

"POWER YOU UP, with your feeling to make your heartbeat get excited than ever with the NEW SUZUKI SWIFT’s unique design, DUALJET engine for the full-speed driving performance..."

 

Heh. Wife and I have had our Suzuki Swift for about a year now. Cash price was 560k baht. We did finance, total of all payments is 660k. Yes, it's all loaded in advance, so 18% interest. But I get a nice 7k monthly payment I like. This is a new car. I've heard of many farangs renting an old car, or financing second hand for 9-10k a month. Ridiculous. Might as well enjoy a new car.

 

As you know, business is down everywhere in general, so the dealers are willing to deal. But they didn't want to deal with financing the farang. They asked my wife to do it, despite having no official income other than a stall in the market. So they told her copy her dad's farm papers, put on farm clothes, and go have her picture taken by the farm. Her theoretical income was calculated as if working the rai of land. Heh. They just want to get cars out the door. You should see all the red plates around. Go for it.

[CharlieH]

off topic English debate removed.

[chilly07]

Buy a new car at 0pc interest from a dealer/ bank combo. Plenty within your price range