Car Financing

[Nickkbh]

Been searching around, but cant seem to find a straight answer.

What does it take to finance a car.

I currently own a Honda Jazz, bought from new, and paid in cash.

Now i want to upgrade, but i don't have cash, and want to finance it.

But what does it take.

I have my own small company, thats does good. Monthly paycheck, WP, and Visa. All legit.

Thanks

Nick

[anon210]

Hi Nick.

Basically, it boils down to this:

- You will need to provide at least a 25 % down payment in cash (except some exceptional finance programs like Ford did for the Escape, where they accepted up to 10 % down). Most of finance companies will turn you down with a lower down payment, unless you have a thai guarantor.

- Your monthly revenues and the quantum of your repayments as well as your credit history will determine if you get finance.

- Your own company "doing good" is a subjective appreciation, if you do not have figures. You cannot pay a new car cash, yet you find that your company is "doing good". No rub here, just that the finance officer might look at your presentation very critically as well.

- it was not clear whether you wanted your company to own the car or yourself. The company might be imposed less favorable finance terms as it is.

[Nickkbh]

Well i do have figure. Its a Thai registered company.

But i guess that doesn't really matter.

I want to keep it in my name, not the company's.

My salary is thb 50.000.- the minimum. For tax reasons.

Is that good enough to get approved?

I have not borrowed any money in Thailand before, and have no debts here.

[anon210]

Well i do have figure. Its a Thai registered company.

But i guess that doesn't really matter.

I want to keep it in my name, not the company's.

My salary is thb 50.000.- the minimum. For tax reasons.

Is that good enough to get approved?

I have not borrowed any money in Thailand before, and have no debts here.

It all depends on the model of car you wish to buy, the initial down payment (25 % as mentioned, sometimes can rise up to 30 %), and the monthly repayments you wish. I guess that with that budget, the maximum repayment would be of about 10 K/month.

On qualifying, it would have been preferable if you had a credit card in Thailand and had been using it for at least six months. That would have guaranteed you a better handling of your file. The paradox of countries like Thailand and the US is that without creating debts, you have no visibility for the credit rating system. The longer you have debts which are always repaid on time, the better your credit rating. In any case, teachers can buy cars with their salary, so I guess you should qualify too.

I guess you will have it easier to buy a car worth less than 800 K (with a big enough down payment) over five years (this means your effective interest rate will shoot up to around 10 %). Some thais manage to buy a PJS with repayments of about 10 K over five to six years, but you will get murdered with the interest rates (calculated at the beginning over the whole amount of the loan).

They will request in any case your last six months of bank statements (to make sure that you have enough cashflow). What you should do is first ascertain what type of car you want, what is your capacity to make a down payment (trading in the Jazz would help, I guess), and for how long you wish to be repaying this car.

[Nickkbh]

got it.

I am looking to buy a CRV.

Perhaps i should give myself more salary.

How much would it take.

I am thinking 30% down, and 4 years to pay it of.

[anon210]

got it.

I am looking to buy a CRV.

Perhaps i should give myself more salary.

How much would it take.

I am thinking 30% down, and 4 years to pay it of.

I think (not wanting to say a nonsense here, not knowing the year, state and mileage of your car) that you might be maybe able to come up with the down through the sale of the Jazz.

However, to appreciate your monthly repayments, please look here:http://www.hondaleas...-calculator.php

I made a quick calculation for the CRV 2.4 L and you end up with 23 K/month to repay.

Rule of thumb, if you are thinking about increasing your salary: your monthly repayments should not be higher than 1/3rd of your monthly net salary.

The best way is to calculate and go see a dealer with your papers and your current salary. See what they offer you, and don't forget you can negotiate everything... esp. the interest rate and what comes on it. As you are buying on finance and over an extended period, they will be earning a commission on it, and might be more agreeable to easier financing deals. Otherwise, just shop around. The dealers want to sell just as much as you want to buy, and there are many Honda dealers around.

[Nickkbh]

My Jazz is just a basic automatic model, registered in 2007, 100k KM.

Has a few bruises, but i can get that fixed. New tyres a few months ago, and new closed panasonic battery.

Gotta say tho, i've been very happy with it.

I guess thats why i want to buy another Honda.

I am guessing realistically it is worth around 300k.