Singapore is notorious for extremely high car prices. With just the cost of COE being around S$50,000 to S$60,000, car prices remain at levels not easily affordable for most Singaporeans. Therefore, car loans are quite popular in the country among car lovers who use them to finance their purchases of new and used cars. If you are in the market for a new or used car and are looking for the best way to finance your purchase, you can read our analysis of the best car loans in Singapore below to see what options are most suitable for you.
Table of Contents
- Best for Refinancing Your Car Loan
- Best Car Loan for New Cars
- Best Car Loan for Used Cars
- Cost Comparisons of Car Loans in Singapore
Best For Refinancing Your Car Loan: OCBC Car Refinancing Loan
OCBC's Car Refinancing Loan is a unique offering that allows you to refinance 100% of your existing car loan at a lower rate. For applicants who have an existing car financing with other banks (for at least 6 months) at an interest rate of 2.40% a year or more, OCBC is offering a Refinancing Loan with just 2.08% in interest rate. This is a great deal that can save you a lot of money.
For instance, let’s say you took out a car loan of S$70,000 for 5 years at 2.78%. After 1 year, you would have paid a total of S$15,946 to the bank, consisting of S$1,946 in interest and S$14,000 in principal repayment. If you stick with such a loan for the full 5 years, it would have cost you S$9730 in interest payment.From you second year and on, you decide to refinance the remaining S$56,000 with OCBC’s Refinancing Loan at 2.08%. This will automatically decrease your monthly instalment from S$1,329 to S$1,260. Not only that, for the remaining 4 years, the total cost in interest will only be S$4,458. This means that you just saved S$3,326 in interest that you otherwise would have paid to your original bank! Below is a table that illustrates this calculation in detail. We've created a car loan calculator so that you can calculate these metrics for yourself.
|Original Loan 1st Year||OCBC Refinancing Loan from 2nd Year||Original Loan for 5 Years|
|Number of Years||1||4||5|
|Total Saving From Refinancing||S$3,125|
Best Car Loans For New Cars in Singapore
If you are buying a new car, we believe DBS's car loan is the best option with the cheapest interest rate. At an interest rate of just 1.99% this loan covers up to 70% of your car’s price, and is available for tenures ranging from 1 year to 7 years. Assuming you borrow S$70,000 over 5 years to fund your purchase, this loan will cost you about S$6,965 in interest. This translates to S$1,283 of equal monthly instalments for the borrower. You can use our car loan calculator to see which option yields the best result for your needs. Besides there are some other notable options that are also available at around 2.7-2.8%, which are about equivalent to DBS's non-promotional offer of 2.78%. If you are already a banking customer with one of these banks, you may choose to go with the same bank for your car loan to simplify your monthly bills.
|New Car Loans in Singapore||Interest Rate||Monthly Instalment||Total cost|
|DBS Car Loan||1.99% (until 17 Nov 2017, normally 2.78%)||S$1,282.75||S$6,965|
|Hong Leong Finance - New Car||2.78%||S$1,329||S$9,730|
|OCBC - New Car Financing||2.78%||S$1,329||S$9,730|
|Standard Chartered - New Car||2.7%||S$1,324||S$9,450|
Best Car Loans For Used Cars
Buying a used car can be a great option if your budget is more limited. However, there are a lot of things you need to make sure before buying a used car. For example, you must do a thorough inspection to ensure the car is not seriously damaged. It’s also worth checking how many years are left in the car’s COE. At any rate, since used cars are worth less than new cars, and since used car buyers tend to be less affluent than new car buyers, banks typically charge a slightly higher interest rates. Given this, we think the OCBC, Hong Leong and Standard Chartered provide the best car loans for used car buyers. All of these banks charge about 3% in interest and lend up to 70% of the car’s purchase price. Assuming you borrow S$50,000 over 5 years to fund your purchase, these loans will cost you about S$7,450 in interest. This translates to S$958 of equal monthly instalments for the borrower. Try using our car loan calculator to estimate your monthly instalments today!
|Used Car Loans in Singapore||Interest Rate||Tenure||Max Principal||Monthly Instalment||Total cost|
|Hong Leong Finance - Used Car||2.98%||1-7 Years||70% of OMV||S$958||S$7,450|
|OCBC - Used Car Financing||2.98%||1-7 Years||70% of OMV||S$958||S$7,450|
|Standard Chartered - Used Car||3.00%||1-7 Years||70% of OMV||S$958||S$7,500|
Cost Comparison of Car Loans in Singapore
Find the Cheapest Car Loans in Singapore
Below, we have featured a chart comparing cost of different car loans in Singapore. We have grouped them by new car, used car and refinancing loans.
Car loans in Singapore typically charge flat interest rates, meaning interest payment is a constant amount each month over the life of a loan. For example, a 2% flat rate for S$10,000 of loan over 5 years will cost S$200 of interest every year. To determine the best car loan options in Singapore, we collected data on all of the car loan offerings that were available in the country. Below, we provide a table summary of the data we collected on car loans ordered by their interest levels and total costs. To calculate cost, we assume the loan is for S$50,000 and is taken out for 5 years.
|Car Loans in Singapore||Interest Rate||Tenure||Max Principal||Monthly Instalment||Total cost|
|DBS Car Loan||1.99%||1-7 Years||Up to 70% of Car Price||S$1,282.75||S$6,965|
|Standard Chartered||2.70% (3% for used)||1-7 Years||70% of Car Price||S$1,324||S$9,450|
|Hong Leong Finance||2.78% (2.98% for used)||1-7 Years||70% of Car Price||S$1,329||S$9,730|
|OCBC Car Financing||2.78% (2.98% for used)||1-7 Years||70% of Car Price||S$1,329||S$9,730|
|UOB HP Car Loan||2.78% (2.98% for used)||1-7 Years||70% of Car Price||S$1,329||S$9,730|
|Maybank Auto Loan||3.25%||1-5 Years||60% of Car Price||S$1,356||S$11,375|
|Century Tokyo Auto Loan||3.28%||1-5 Years||70% of Car Price||S$1,358||S$11,480|
|OCBC Car Refinancing||2.08%||1-7 Years||100% of Outstanding Balance||S$1,030||S$5,824|