Step by Step Process in Used Car Financing with Banks and Private Lenders
When you buy a second hand car in the Philippines, your usual destination would be are those car dealers and showrooms where you can find used cars for sale. You try to ask if the dealer or seller would allow car financing. Well, they usually do allow it but what is your guarantee that you will end up with the best deal ever for your money’s worth? There really is none. That is the reason why we here at Car Loan Philippines is writing these kinds of tips. They are especially designed to help you, our clients get the best out of your time, money and effort spent with us. If you like you can directly consult us for FREE. So let’s get to the point as we would like you to have the best and easiest experience with applying for your used car financing whether you opt in to do it with us or not. Below are the step by step process in order to have an easy way in and out of a prospect car to buy.
10-Step Process in Applying for Used Car Financing
- Answer this question – This is the first and most important step – do a self test priority check. Never deny any previous banking related problem to your agent or to yourself. Trying to fool others including yourself will make you end up with disappointment. Here are some of the questions you have to ask yourself – Do you have a bad credit or banking status? Meaning, have you ever had an unpaid credit card? bounced check issued/case? repossessed car in the past? unpaid bank loans and other private company loans? immediate relatives in the military, media, politics, police and so on? The importance with being cautious with these issues is to know that even before you try to apply for 2nd hand car financing, you are 100% sure to qualify. With the relative issue, you can always not disclose when asked so take that one out as part of your problem. Just know how to answer the question right and which information to provide with your financing company of choice. Many of our previous client will fail in this because of their dire need to get a car even if they know they have been declined before with banks. Do note that there is still a slim chance you can get approved of your loan application but rest assured it will really be slim so don’t expect.
- Find a prospect car – You can get access to a list by visiting popular online websites first. This will save you time rather than directly walking in and visiting used car showrooms around. After all, most of the 2nd hand car dealers and sellers you will find in the field are also posting and selling their cars in these online classified ads websites. If you are not familiar with these sites, then let me reveal to you some of them. olx.ph / carmudi.com / carfinderph.com / buyandsellph.com and many more. In finding your dream car, take note of the price and compare it to your budget for reference. Never waste your time trying to buy a vehicle that is not in your capacity to pay for it. In this case, you will need a financing quotation which we will go over with below (we offer free quote for this purpose).
- List down your prospect cars – After visiting sites and finding a prospect auto, you have to make sure to make a list of the specifications. This should include car make or brand and year model plus their series (ex, Toyota Vios 2015 1.3 E AT). You must make sure to list down the respective contact numbers of the dealer or seller who is selling the vehicle including the selling price and where you can find the car location. You will use this later on when you compare prices over your desired vehicle and to ask for deals or discounts or freebies if there are any.
- Talk to the dealer or seller – After deciding which ones of the used car units you have listed above you want to pursue with using for your used car financing, you have to call the owner of the vehicle and ask for details as listed above. Don’t forget to ask for discounts. Most importantly, you have to ask if they allow outside financing for the car they sell. Many dealers would discourage you for reasons that may not be obvious to ordinary buyers – dealers get incentive when they are the ones to find a financing company to have their for sale vehicles taken in for used car financing. Mostly, their providers are banks due to low fees but do note that their process may take up to even more than 1 month. In this case, ask the dealer if you can also have the car you are interested to buy under financing that you wanted to personally find for yourself. There is no harm in comparing so don’t turn down the dealer’s offer for financing. Use that instead for later comparison. Just have him or her know that you wanted to compare their quotation with an outside provider you have talked with.
- Find a financing company – In finding a legitimate financing company or bank, always think of asking questions. With banks, there is definitely no doubt you can directly walk in but with private lending companies, it is easier to ask an agent or a broker or a loan consultant first. Make sure their services are FREE just like what we offer here at Car Loan Philippines as an accredited loan agency in the Philippines.
- Ask for a quotation – Many private companies including most banks would offer FREE online loan calculator feature. You can use those to get the edge of not needing to walk in and spend time to travel and ask so many questions just to come up with the most important figures coming from a 2nd hand car financing quotation. With a private lending company, there is always no harm asking for a quotation first form your agent. Remember that it’s always free to get a quote out of a car you wanted to buy whether it is brand new or second hand. Always ask for discounts and freebies or any other related deals.
- Compare quotation prices, fees and processing time – It is mostly understood that when we try to compare quotation for used car financing that we take in to consideration figures. Fact is there is always the importance of considering time frame of process. The reason is because you have competition with the auto you wanted to buy – this is from buyers who have cash on hand to get the unit for sale. If you happen to stumble upon a good unit that is most wanted by buyers, chances are, you might end up competing with a cash buyer and I am 100% sure this time you will loose. So it is best not to neglect the processing time. Ask from banks and private lenders or better yet, go for both and process to both and see later which one can do it faster. Time is always of an essence especially with car dealers. These people always needs to sell their units in cash basis unless they don’t have such an offer.
- Know the fees and the initial down payment you need – Last thing to remember is to bear in mind that no financing company or bank will allow a full financiable amount to be financed under their 2nd hand car financing program. Expect to shell out at least 30% of the full selling price of the unit you wanted to buy. Be sure you have that amount ready or all else will be useless.
- Prepare all requirements – Always prepare prior to application and the necessary requirements you will need. You will know this by asking either your dealer, the bank or your loan agent. By preparing we also mean that at this point you already know which questions will be asked thru a background investigation which most if not all banks and private financing companies usually ask before and during processing time of your used car financing application.
- Process to both banks and private lenders – Be sure to opt in to all providers you can possibly find and apply with them. Here in the Philippines and elsewhere in the world, we call it canvassing. This specific step never stops until you get the car you have always dreamed of.
Requirements for Used Car Financing
Please check our list of complete requirements together with a sample interest rate and year model accepted listing here. This might be updated anytime our providers change their policies so be sure to confirm with us by calling us below or sign up using our online form below.
- Completely filled up application form. You can download it here.
- Photocopy of Car OR CR you wanted to buy
- TIN ID or any proof of TIN (also photocopy)
- 2 original primary valid IDs photocopied in one page
- Original proof of billing (we only accept electric or water bill) (even if bill is not under borrower’s name) (address must be the same as any of your 2 valid IDs)
- Car model must be year 2000 and up
- Borrower must have a source of income – (if with business – must provide photocopy and original DTI business permit or mayor’s permit + 3 months latest bank statement) (if with remittance from abroad – must provide 3 months latest remittance receipt with name of receiver as the borrower + 3 months latest bank statement) (if with property for rent – must provide photocopy of contract of lease + 3 months latest bank statement) (if with work – must provide 3 months latest payslip and certificate of employment / COE)
- Car owners with own checking account will have the advantage for fast processing of used car financing as a PDC is needed upon car release.
After learning from us the basic simple step by step process in buying a second hand car and opting to apply for used car financing with banks or private lending companies, we assume you are ready by now. If you are and you are interested to learn more and have your questions answered, don’t hesitate to contact us above or using the details below. We’d be glad to assist you as your qualified loan consultant / agent.
Fill Up Our Loan Application Form Below
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