The Philippines’ small and usually congested roads are a bane to an everyday commuter, making the nearest mall or school just a couple of blocks from your apartment a 45-minute ride away. And for many of us, it’s better to pay a little more money just to get to our destination faster and more comfortably. Grabbing a cab is the immediate fix. But if you like to ease up your commute every time, getting a car might be a good long-term solution. Even a 5-seater, second-hand car will do, as long as the price is reasonable.

Good for you if you have cash for a planned car purchase. But for those who don’t, one of the best ways to go is get a car loan.

The Costs of Buying a Car and Some Buying Tips

Before you call a car loan provider, it pays to look more closely at the car you’re planning to buy and set a price range.

“Based on the latest price comparison charts, the cost of a brand-new car is usually around PHP 400,000 to PHP 1,000,000 for a basic family car. Luxury cars can amount to a couple of millions while second-hand cars may be bought at around PHP 250,000.”

The down payment usually plays around 15 to 20% of the purchase price, although there’s a good chance you can lower this down through negotiation. Payments may be made monthly over a specific period of time. But here’s a quick tip from’s senior consumer adviser Phil Reed: Negotiate on the purchase price, instead of the monthly payments. This will greatly reduce your loan tenure and save you hundreds of dollars’ worth of interest rate.

Reed added that buyers should think twice before signing up to any aftermarket add-ons (e.g., insurance). Again, it pays to do a little research to know where and how to get those add-ons on your own at a lower price.

Car Loans: Computation and Tips

Let’s assume that you’re planning to buy a car that’s worth PHP 700,000. 20% of that amount (PHP 140,000) would normally be paid by the bank, leaving you with a principal amount worth PHP 560,000. Let’s say that you plan to pay this within 36 months.

Interest rate varies per bank and depending on the loaned amount and tenure. For the car loan price scenario above, banks place a monthly rate of around 4.79% (e.g., Security Bank),5.63% (e.g., BDO) to as high as 9.44% (e.g., Metrobank).

Summing up, you’ll be paying at least PHP 17,000 to PHP 19,000 per month. And when we take a closer look, you’re most likely to pay a total of PHP 80K to PHP 158K throughout the tenure of the loan. Sounds a lot, right?

This explains why it’s necessary to negotiate on the purchase price, ensuring that you’ll be paying a lesser rate. Besides, decide carefully on what add-ons you need before getting anything.

How Can Help

We can help you with your car loan needs if you qualify these eligibility requirements

Age – 21 years old but not over 70 by the time your loan matures

Citizenship – Filipino

Income – A regular employee earning at least PHP 10K and who’ve spent at least 1 year in the company or a self-employed individual with a business that has been profitable for at least 3 years. is the Philippines’ largest network of lenders. It facilitates fast and easy access to credit for different financial needs by connecting borrowers to multiple lending partners in single online loan application. 

If you want to apply for an online car loan, visit Loan Solutions.

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