Bank Loan Or Direct From Car Dealership?

[RebelRed]

Hi

I am looking to buy a car from Chevrolet in Ubon Ratchathani. The dealership are offering 3.6% interest p.a. which would mean a hefty 21% over 6 years. The car value is 587k but I will end up paying close to 700k!!!

I was wondering if getting a loan from my bank instead would work out cheaper? Information I have been getting is that the banks charge the same.

Thanks

Liam

[DJH77]

Banks don't lend on cars to my knowledge but some banks have Finance Companies tied to them for car loans and there are many other finance companies that you can get quotes from as to their interest rates and choose the best available. But the easiest finance to get is usually through the dealer and sometimes they are negotiable. When i bought my Palero 2 yr ago they started at 2.6% and i eventually got it at 1.6% via the dealer through Krungsri Auto, they would have an office in Ubon i Think. I know they have one in Sakon Nakon, Check their web site.

[anon210]

Hi

I am looking to buy a car from Chevrolet in Ubon Ratchathani. The dealership are offering 3.6% interest p.a. which would mean a hefty 21% over 6 years. The car value is 587k but I will end up paying close to 700k!!!

I was wondering if getting a loan from my bank instead would work out cheaper? Information I have been getting is that the banks charge the same.

Thanks

Liam

Just for the sake of argument compare that to car loans in Europe. They go up to 7-12 % p.a. Compared to that loans in Thailand are pretty cheap. However I believe that you could do better than that if you chose a shorter period.

There is a paradox at Thai car dealers: they go

for longer finance periods as their commission is higher; but too long and you get hit with a higher interest rate. Try at least to have some goodies thrown in.

Sent from my GT-N7000 using Thaivisa Connect App

[uwe_rayong]

Hi

I am looking to buy a car from Chevrolet in Ubon Ratchathani. The dealership are offering 3.6% interest p.a. which would mean a hefty 21% over 6 years. The car value is 587k but I will end up paying close to 700k!!!

I was wondering if getting a loan from my bank instead would work out cheaper? Information I have been getting is that the banks charge the same.

Thanks

Liam

Just for the sake of argument compare that to car loans in Europe. They go up to 7-12 % p.a. Compared to that loans in Thailand are pretty cheap. However I believe that you could do better than that if you chose a shorter period.

There is a paradox at Thai car dealers: they go

for longer finance periods as their commission is higher; but too long and you get hit with a higher interest rate. Try at least to have some goodies thrown in.

Sent from my GT-N7000 using Thaivisa Connect App

Thai finance only sounds cheaper as in Europe because Thais calculate the interest on the total sum x years.

For example you lend 600,000 with 2% p.a. (2 % 12000THB per year) for 48 month you pay even in month number 47 1000 THB interest to finance.

In Europe the interest is calculated only on the amount you owe to the bank! In the above example:

600000 x 2% p.a. 48 month fixed thai style =

600000 + (12000*4)=648000 total

Thats about 3.85% if you use the correct way to calculate interest.

http://www.calculato...calculator.html

587000 - 3.6% p.a. flat - 6 years

587000 + (21132*6)=713792 ( interest 126792 THB) thats about 6.7% p.a. outside of Thailand...

[anon210]

Thanks for the demonstration. The key is here to keep the repayments over as low a period as possible. In general dealers are super-annoyed when you tell them you want to repay in one or two years.

Some Ford dealers then tried to hit me with a higher interest (5 %) just to maintain the 30 k in interest that would earn them a commission. I have to say that MRO's posts on sales tips have helped me a lot in negotiating.

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