While there are so many people who have mistakenly identified car financing to be the same as car loan, there were only 2 types offered in the Philippines. The first one is used car financing and the second one is brand new car financing. Whether you are up either of these two or up to apply for a loan using your OR CR, there will be different sets of requirements and procedures and surely, charges and fees will be a major issue. Apart from these major issues, knowing how to qualify is another one, a first to learn about for the buyer.

Being a loan consultant for many top lending companies in the Philippines from banks to private lenders, I have come to know almost all the necessary information Pinoys might need before buying a new or 2nd hand car and have it financed. I will be sharing my personal experience being a professional agent and being a customer when I bought my Toyota Yaris back in 2008. In aim to help Pinoys discover the wonderful world of car financing in the Philippines, here is my take based from actual experience.

What to Prepare When Applying for Car Financing in the Philippines

Although each type of application may differ in terms of requirements, I will try my best to consolidate all information i have learned in my more than 3 years in the auto loan industry. Will post below a different set of documents the borrower or applicant will need when applying for car financing. To increase your chances of getting approved of your car financing application, please read this article. Need low down payment? Please read it here.

Requirements for Brand New Car Financing

1. Own checking account and enough number checkbook to issue for the loan equivalent to loan payment term chosen.
2. 2 valid primary IDs
3. TIN ID / number
4. Latest proof of billing (electric or water bill only) (may not be under your name but must have same address as your 2 valid IDs
5. Latest 6 months bank statement
6. Documented source of income – if with work —> must provide 3 months latest payslip and COE (with ITR) / if with business —> submit DTI or SEC and Mayor’s Permit + barangay business permit and 6 months latest bank statement / if with property for rent —> contract of lease and 6 months latest bank statement / if with freelance job or remittance —> any voucher, remittance receipts and 6 months latest bank statement

Requirements for Second Hand Car Financing

1. Latest OR CR (official receipt and certificate of registration) – this will come from your car dealer or seller
2. 2 valid primary IDs
3. TIN ID / number
4. Latest proof of billing (electric or water bill only) (may not be under your name but must have same address as your 2 valid IDs
5. Documented source of income (your choices) – if with work —> 1 month latest payslip and COE (with ITR is an advantage) / if with business —> DTI or SEC and Mayor’s Permit and 3 months latest bank statement / if with property for rent —> contract of lease and 3 months latest bank statement / if with freelance job or remittance —> any voucher, remittance receipts and 3 months latest bank statement

Step by step procedures in financing your dream car

1. Set your budget via canvassing. If you want to buy second hand or used car, know your capacity to pay by asking for an initial computation from the financing company. If you are buying a new car, ask how much down payment and monthly amortization computation via loan calculator.
2. Choose a unit or car brand you want to have financed based from your budget.
3. If you are buying a used car, ask for a copy of the OR CR from the dealer or seller. If you are buying a new car, make sure that you have enough money to use as down payment and that your income will be sufficient to pay for your monthly dues.
4. Prepare all the necessary requirements as listed above for a chosen category (new or used car)
5. Submit requirements and ask for a quotation from the company and computation using loan calculator.

If you have any doubts, you can always try to ask for FREE consultation. If you are a seafarer, you can always read help tips here or file for a seaman loan to get money for use in initial down payment or talk to a seaman loan agent.