Need advice, 1st time car and it will be financed.

**Scuttle** · October 25th, 2014 07:35 AM

Right now, im in similar scenario. Approved na ung loan ko sa 2 banks, bakit naging 2, kala ko kasi denied ako dun sa una kasi 2 days processing daw, inabot ng 2 weeks. Yung 2nd bank ko same day na approved. In the end 2 yung approved ko. Problem ko, yubg 1 bank nagissue agad ng PO, me impact ba yun sa decision making ko? Tali na ba ako nun? What if mas ok pala ang offer ng 2nd bank diko pa kasi nakikita yung details ng 2nd bank.

Bank loans po to hindi inhouse btw.

**shemcristobal** · January 5th, 2015 10:50 PM

Originally Posted by Scuttle

Right now, im in similar scenario. Approved na ung loan ko sa 2 banks, bakit naging 2, kala ko kasi denied ako dun sa una kasi 2 days processing daw, inabot ng 2 weeks. Yung 2nd bank ko same day na approved. In the end 2 yung approved ko. Problem ko, yubg 1 bank nagissue agad ng PO, me impact ba yun sa decision making ko? Tali na ba ako nun? What if mas ok pala ang offer ng 2nd bank diko pa kasi nakikita yung details ng 2nd bank.

Bank loans po to hindi inhouse btw.

I'd like to hear an update on this case.

Ang iniisip ko hindi ka tali until pirmahan mo ung docs.

**EQAddict** · October 25th, 2014 12:43 PM

Low DP schemes equate to HIGH monthly payments. If you cant afford the DP, I seriously suggest you think long and hard about committing to a 5 year loan. Remember the monthly will be disproportionately high, then you have gas, parking expenses, maintenance, yearly insurance coverage, etc.

Make sure the monthly payments of the car are less than a fourth of your net take home pay. If it isnt you are in for some financial pressure and pain for a long time.

And its a mistake to think that you can just sell the car aka "assume balance" if you have problems paying. Your low DP and high monthly interest expenses ( less of your payments go to the principal) would mean you will have much less equity in the car. So factor in the depreciation hit, you will have to shell out a lot more money just to get rid of a car you cant keep.

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**1-PZIN01** · November 27th, 2014 05:44 PM

Hi,

Like the thread starter, I'm in a similar situation. I just want to know your take on the offer from Mitsubishi, which I'm assuming is an in-house financing set up.

2014 Lancer EX GT-A
DP - 19K
Monthly - 24,246 (60 months)
SRP - 1.195M

On a strictly and straightforward "cash interest" this will come out to about 24%.

This will "possibly" be my first car. The monthly expenses I can deal with also can afford a monthly amortization in the range of 20-25K, except that I don't have the money for a large DP, for now.

Appreciate your comments/feedback.

**mda** · November 27th, 2014 05:58 PM

Originally Posted by 1-PZIN01

Hi,

Like the thread starter, I'm in a similar situation. I just want to know your take on the offer from Mitsubishi, which I'm assuming is an in-house financing set up.

2014 Lancer EX GT-A
DP - 19K
Monthly - 24,246 (60 months)
SRP - 1.195M

This will "possibly" be my first car. The monthly expenses I can deal with, except that I don't have the money for a large DP, for now.

Appreciate your comments/feedback.

If you don't have the money for either DP or monthly amortization? Save up first and go for a cheaper car.

Vios perhaps?

Also, inhouse financing is gonna be expensive. Go bank PO. BDO, BPI, PSbank (as far as I remember) offer good competitive rates on cars, unless your main bank is elsewhere (go check w/ them).

**cast_no_shadow** · November 27th, 2014 06:23 PM

Originally Posted by 1-PZIN01

Hi,

Like the thread starter, I'm in a similar situation. I just want to know your take on the offer from Mitsubishi, which I'm assuming is an in-house financing set up.

2014 Lancer EX GT-A
DP - 19K
Monthly - 24,246 (60 months)
SRP - 1.195M

On a strictly and straightforward "cash interest" this will come out to about 24%.

This will "possibly" be my first car. The monthly expenses I can deal with also can afford a monthly amortization in the range of 20-25K, except that I don't have the money for a large DP, for now.

Appreciate your comments/feedback.

My take. You can afford a 20-25k MA, why don't you hold first your purchase for a few months then save it for a bigger DP.

Lower na MA mo, mas mura pa loan mo after completing it compared kung mag low downpayment option ka.

Still its your money. Your rules.

HTH

Sent from my iPhone using Tapatalk

**1-PZIN01** · November 27th, 2014 06:31 PM

Originally Posted by mda

If you don't have the money for either DP or monthly amortization? Save up first and go for a cheaper car.

Vios perhaps?

Also, inhouse financing is gonna be expensive. Go bank PO. BDO, BPI, PSbank (as far as I remember) offer good competitive rates on cars, unless your main bank is elsewhere (go check w/ them).

Thank you Sir mda, very insightful PM with the monthly expenses estimate. Really appreciate it.

Originally Posted by cast_no_shadow

My take. You can afford a 20-25k MA, why don't you hold first your purchase for a few months then save it for a bigger DP.

Lower na MA mo, mas mura pa loan mo after completing it compared kung mag low downpayment option ka.

Still its your money. Your rules.

HTH

Sent from my iPhone using Tapatalk

The logical side of me of course is saying that this is the correct thing to do. To wait and save.

The other part is telling me, I'm too old not to have my own car.

Anyway I really just wanted your take on the deal. And I'm nowhere near accepting that, because I don't even have my license renewed, which has been expired since 2010.

**willyfernando** · November 27th, 2014 08:45 PM

Here's my take on buying a brand new car thru financing…

You should be aware of your true financial standing when it comes to buying a brand new car. Five years ago I wanted to convince my self that I deserved a brand new car but back then a 30% DP was already putting a strain on my finances so I settled for a good second hand vehicle. The car had 70k mileage but it was well maintained so I got it and used it till this year when a friend bought it from me. The term "need" is a driving factor why people take the plunge but the truth is their "wants" convinces them that only a brand new car will solve their mobility issue. True, that maintenance issues are a big factor but if they are not as bad as making amortization payments then save first for a well deserved brand new car with the confidence that you can handle any form of financing arrangements. A friend once told me, "People are never in doubt with their purchases whether it is an insanely priced car or jewelry if they know they can afford them. The doubtful ones are usually those whose "wants" outweigh their "needs" but are oblivious of their true finances hence, "repossession". Five years later, with a good credit standing and healthy finances I finally bought myself not one but two new cars. Who says we are too old to own brand new cars? I'm turning 50 next year and I am still enjoying my life with very little stress because I am very practical and true to myself. No offense meant to anyone, Just sharing what I believe saved me from a lot of financical woes if I had taken the plunge five years ago.

**1-PZIN01** · November 27th, 2014 10:57 PM

Originally Posted by willyfernando

Here's my take on buying a brand new car thru financing…

You should be aware of your true financial standing when it comes to buying a brand new car. Five years ago I wanted to convince my self that I deserved a brand new car but back then a 30% DP was already putting a strain on my finances so I settled for a good second hand vehicle. The car had 70k mileage but it was well maintained so I got it and used it till this year when a friend bought it from me. The term "need" is a driving factor why people take the plunge but the truth is their "wants" convinces them that only a brand new car will solve their mobility issue. True, that maintenance issues are a big factor but if they are not as bad as making amortization payments then save first for a well deserved brand new car with the confidence that you can handle any form of financing arrangements. A friend once told me, "People are never in doubt with their purchases whether it is an insanely priced car or jewelry if they know they can afford them. The doubtful ones are usually those whose "wants" outweigh their "needs" but are oblivious of their true finances hence, "repossession". Five years later, with a good credit standing and healthy finances I finally bought myself not one but two new cars. Who says we are too old to own brand new cars? I'm turning 50 next year and I am still enjoying my life with very little stress because I am very practical and true to myself. No offense meant to anyone, Just sharing what I believe saved me from a lot of financical woes if I had taken the plunge five years ago.

Great discussion Sir.

To be honest I haven't really considered buying a second hand car mainly because of lack of knowledge. I'm hesitant because I don't know what I need to look for.

But after reading your post, I immediately checked. Like most guys in the my age group (21-30) I grew up always admiring the Honda Civic. I immediately checked for a 2012 model of it.

Any tips on what I need to look for? Also I'm assuming that a second hand car can also be purchased through bank financing?

Thanks again.

**Juan Martinez** · April 28th, 2015 04:05 AM

Originally Posted by willyfernando

Here's my take on buying a brand new car thru financing…

You should be aware of your true financial standing when it comes to buying a brand new car. Five years ago I wanted to convince my self that I deserved a brand new car but back then a 30% DP was already putting a strain on my finances so I settled for a good second hand vehicle. The car had 70k mileage but it was well maintained so I got it and used it till this year when a friend bought it from me. The term "need" is a driving factor why people take the plunge but the truth is their "wants" convinces them that only a brand new car will solve their mobility issue. True, that maintenance issues are a big factor but if they are not as bad as making amortization payments then save first for a well deserved brand new car with the confidence that you can handle any form of financing arrangements. A friend once told me, "People are never in doubt with their purchases whether it is an insanely priced car or jewelry if they know they can afford them. The doubtful ones are usually those whose "wants" outweigh their "needs" but are oblivious of their true finances hence, "repossession". Five years later, with a good credit standing and healthy finances I finally bought myself not one but two new cars. Who says we are too old to own brand new cars? I'm turning 50 next year and I am still enjoying my life with very little stress because I am very practical and true to myself. No offense meant to anyone, Just sharing what I believe saved me from a lot of financical woes if I had taken the plunge five years ago.

+1 another great advice. actually, all the posts in this thread are very helpful. may your tribe flourish.