MAS Eases Rules on Motor Vehicle Financing

Posted by Oneshift Editorial Team
26 May 2016
MAS Eases Rules on Motor Vehicle Financing

The maximum LTV (loan-to-value ratio) will be raised from 60% to 70% for vehicles with OMV (open market value) less than or equal to $20,000. 50% to 60% for vehicles with OMV greater than $20,000. Maximum loan tenure raised from 5 to 7 years.

The Monetary Authority of Singapore (MAS) today announced that the maximum loan-to-value (LTV) ratios and loan tenure allowed for motor vehicle loans will be eased, although restrictions will remain in place for the long term. The adjustments follow the sustained moderation in Certificate of Entitlement (COE) premiums and in resulting inflationary pressures over the last three years.

In 2013, MAS introduced restrictions on motor vehicle loans by financial institutions, to moderate the demand for cars and COEs and alleviate inflationary pressures. The measures also served longer term purposes: to encourage financial prudence and to support efforts to promote a car-lite society.

Since then, the contribution of private road transport (excluding petrol) to CPI-All Items inflation has eased from +1.3% points in 2011-2012 to -0.5% point in Q1 2016. In addition, outstanding motor vehicle loans have declined by 32% from $14.13 billion in Q1 2013 to $9.55 billion in Q1 2016.

The allowable vehicle population growth rate remains capped at 0.25% per annum. However, COE quotas have expanded in recent quarters alongside an increase in de-registrations.1

Taking these developments into account, the rules on motor vehicle loans will be revised as follows with effect from 27 May 2016: 

 

* LTV is the amount of the loan expressed as a percentage of the purchase price of the motor vehicle. The purchase price includes relevant taxes and price of the COE.


The Ministry of Trade and Industry will apply the revised financing restrictions to non-MAS regulated entities which extend motor vehicle financing on a hire-purchase basis. The Ministry of Law will also require licensed moneylenders to comply with the revised financing restrictions.

Mr Ong Chong Tee, Deputy Managing Director, MAS, said, “In 2013, when we introduced the measures, our immediate aim was to help restrain escalating COE premiums and consequent inflationary pressures. Since then, demand conditions have moderated and it is timely to ease the measures. MAS will, however, continue to have the LTV and loan tenure framework in place for the long term to promote financial prudence and help support the promotion of a car-lite society.”


Sell Fast With Ease - SwiftQuote

With SwiftQuote, you get:
  Best value for your car    A peace of mind when selling    Fast sale from start to end

HIGHEST PRICE FOR YOUR CAR

Best offer with no obligations.
Start Now!

I agree to the collection, use and disclosure of my personal data by Carousell and/or such other third party (as may be necessary) and to be contacted (via email, phone call and/or text message) for any purposes in connection with the application of and transaction of the vehicle, in accordance with the Personal Data Protection Act 2012 and Carousell's Privacy Policy.

Truely platform SwiftQuote is swift professional customer friendly and courteious. I thank u very much once again thk u very much

Othman Bin Taib - 19 hours ago

Great website to sell your car!! Good service too

Scott - 1 day ago

Hassle free. Just indicate your car status and get reply within 1 day. Receive good quote.

Mohamed Nassir Bin Mohamed Kassim - 2 days ago

Fast, efficient and effective. A great way to sell your car!

Ramesh Sambandam - 5 days ago

I was quite skeptical about this service but as the saying goes - if you don't try, you don't know...so I tried. I've managed to fetch a good price through this platform. I would recommend all sellers to consider using this platform if you want to sell your vehicle.

Taufik - 6 days ago

Thank you for your service! You have been helpful, reliable and efficient; definitely highly recommended to those who want to sell their car. Best Regards Shirley

Shirley - 1 week ago

Quick response and good service SwiftQuote agents.

David Chong - 1 week ago

The system was very easy to use and the dealer very reliable. Price transacted was same as bid. The whole transaction was completed in 2 days. I will recommend Oneshift Swiftquote!

Richard Lee - 1 week ago

SwiftQuote was swift in quoting a price for my car! It was the highest scrap value that I checked around. After bringing the car to the dealer, the whole process took less than 10mins. I was impressed! Thank you, SwiftQuote!

Siva - 1 week ago

The service is good and friendly. Thank you Swiftquote.

Michael Yeh - 1 week ago
News
167
167
9 Oct 2019
Posted in News
News
204
204
18 Sep 2019
Posted in News
News
187
187
18 Sep 2019
Posted in News
News
281
281
9 Sep 2019
Posted in News
News
540
540
4 Sep 2019
Posted in News
News
682
682
25 Jul 2019
Posted in News
News
724
724
18 Jul 2019
Posted in News