Top 15 banks for affordable car loans in the Philippines

car loans in the Philippines

Congratulations! Now, if you have landed on this blog, it’s probably because you plan to make a big purchase, a car. If that’s the case, we must tell you it is a big deal and comes with many financial decisions. No, we do not intend to scare you, but it’s better to be prepared than get surprised, right?

KEY TAKEAWAYS

  • Can OFWs apply for car loans in the Philippines?

    Many banks offer special loan products tailored for OFWs, requiring proof of employment and remittance.
  • Can self-employed individuals apply for car loans in the Philippines?

    Yes! You’ll need to provide additional documents like financial statements and proof of business operations to qualify.
  • What’s the minimum income requirement for a car loan?

    Most banks require a monthly income of around PHP40,000 for brand-new cars and PHP20,000 for second-hand vehicles.
  • What’s the difference between bank financing and in-house financing?

    Bank financing generally offers lower interest rates but requires more paperwork. In-house financing is quicker but comes with higher interest rates.
  • Luckily, many banks in the Philippines offer auto loans that turn the dream of owning a car into a reality. It doesn’t matter if you are after a shiny new four-wheeled beauty or a reliable second-hand car, there’s always a financing option waiting to serve you and your needs.

    We have compiled a list of 15 banks offering some of the best car loan deals in the Philippines. But before that, did you know that there are several financing options available for a car buyer in the Philippines? Each of these options caters to different needs and financial situations, so let's check them all out.

    Also Read: Here's why your car loan can get rejected in the Philippines

    Car financing options in the Philippines

    Brand-new car loans

    This is the most common type of car loan for buyers looking to purchase a new car. A buyer can finance up to 80% of the car’s price, and interest rates tend to be lower compared to other loan types.

    • Best for: Those who want a brand-new vehicle.
    • Interest rates: 6% to 8% per annum.
    • Loan term: Up to 60 months.

    Second-hand/used car loans

    Banks offer loans for pre-owned vehicles but at slightly higher interest rates. It is an affordable option if the applicant is on a tight budget.

    • Best for: Those wanting a secondhand car.
    • Interest rates: 8% to 10% per annum.
    • Loan term: Up to 48 or 60 months, depending on the car's age.

    car finanace options in the Philippines

    In-house financing

    Offered by several dealerships, it is convenient but usually comes with higher interest rates compared to traditional bank loans. However, approvals are quicker and require less documentation.

    • Best for: Buyers looking for convenience and speed.
    • Interest rates: 8% to 14% per annum.
    • Loan term: Varies, typically up to 60 months.

    Chattel mortgage

    A common type of secured loan where the car itself is used as collateral. Interest rates are lower because the bank holds a claim on the car until the loan is fully repaid.

    • Best for: Buyers who want lower interest rates and are okay with collateral.
    • Interest rates: Typically lower due to collateral.
    • Loan term: Up to 60 months.

    car finacing options

    Balloon payment plans

    It allows the applicant to pay lower monthly installments but a large lump sum at the end of the loan term. It is ideal if you expect to have more funds later on.

    • Best for: Buyers who need low monthly payments but can make a larger payment at the end.
    • Interest rates: Slightly higher than standard loans.
    • Loan term: Typically 36 to 60 months, with a balloon payment at the end.

    Car refinancing loans

    Car refinancing loans

    It allows borrowers to replace their existing car loan with a new one, often at a lower interest rate or more favorable terms.

    • Best for: Buyers who want to lower monthly payments or extend the loan term.
    • Interest rates: Dependent on the new loan, typically lower than the existing loan.
    • Loan term: Depends on the lender's assessment, often up to 60 months

    Auto loan for OFWs

    Specialized loan allowing OFWs to purchase vehicles while working abroad.

    • Best for: OFWs looking for flexible loan terms, accommodating their unique income and documentation challenges.
    • Interest rates: Similar to standard car loans, often between 6% and 12%.
    • Loan term: Up to 60 months.

    OFWs car loan

    Lease-to-own car financing

    It allows prospective buyers to lease the vehicle. They make regular payments that go towards eventually owning the car.

    • Best for: Buyers who aren’t ready for full ownership upfront but still want a path to ownership over time.
    • Interest rates: Generally higher than traditional loans.
    • Loan term: Flexible, often between 12 and 60 months.

    Also Read: Important financial terms a car buyer must know

    Top banks offering affordable car loans in the Philippines

    1. Bank of the Philippines Islands (BPI)

    BPI is a solid choice when it comes to car loans, thanks to its competitive interest rates starting at 6.30% per annum. They offer flexible loan terms, ranging from 12 to 60 months, and can finance up to 80% of the car’s price.

    Loan Term

    12 to 60 months

    Down Payment

    20% of the car price

    Interest Rate

    From 6.30% per annum

    2. Philippine National Bank (PNB)

    PNB’s auto loan is another great option, especially for those who want to finance brand-new vehicles. They allow you to borrow up to 80% of the car’s price with a repayment term of up to five years.

    Loan Term

    12 to 60 months

    Down Payment

    20% to 50% of the car price

    Interest Rate

    Inquire directly for rates

    3. PSBank

    Need a fast approval? PSBank could be your go-to. They promise to let you know the status of your car loan application within 24 hours, plus you can earn rebates if you pay in advance.

    Loan Term

    12 to 60 months

    Down Payment

    Starts at 20% of the car price

    Interest Rate

    Based on prevailing market rates

    4. RCBC

    RCBC offers flexibility with their car loan options, allowing you to choose between brand-new and secondhand cars. They even include perks like free insurance for the first year.

    Loan Term

    12 to 60 months

    Down Payment

    20%to  50% of the car price

    Interest Rate

    From 5.35% to 28.76%

    5. Security Bank

    Security Bank’s auto loans are known for their fast approval process (3 to 5 banking days) and competitive interest rates. You can borrow up to 80% of the car’s price with flexible terms.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    From  6.77% to 37.63%

    6. Union Bank

    UnionBank offers a quick and simple process to finance both new and used cars, with loan terms of up to 60 months. The bank also partners with auto brands like Chevrolet and Honda for special promos.

    Loan Term

    12 to 60 months

    Down Payment

    20% to 50% of the car price

    Interest Rate

    From 6.56% to 31.76%

    7. Robinsons Bank

    If you’re looking for low interest rates, Robinsons Bank might be the one. Their rates start as low as 4.31% for both brand-new and secondhand vehicles, and their loan terms are quite flexible.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    From 4.31% to 28.76%

    8. Sterling Bank of Asia

    Sterling Bank’s Ultima Auto Loan is designed for both brand-new and used cars. Their loan terms go up to 60 months, making it easy to budget your payments.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    Contact the bank for details

    9. EastWest Bank

    EastWest Bank offers some of the most competitive auto loan rates in the market, with flexible terms and quick processing times.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    Contact the bank for details

    10. China Bank

    China Bank’s auto loan products cover both brand-new and secondhand cars. They offer fast loan approvals and allow you to choose flexible repayment terms.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    Contact the bank for details

    11. BDO Bank

    BDO’s auto loans offer flexible repayment terms of up to 60 months. They finance both brand-new and used cars, and approvals are generally quick and easy.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    Contact the bank for details

    12. Metrobank

    Metrobank’s auto loan program allows you to finance up to 80% of the car’s price, with flexible terms and low interest rates. It’s available for both brand-new and used cars.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    4.63% to 28.41%

    13. Asia United Bank

    AUB offers flexible car loan options for individuals and businesses, including light trucks. Their approval process is quick, and they offer competitive rates.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    Contact the bank for details

    14. Maybank

    Maybank’s auto loan offers come with competitive interest rates, allowing customers to finance brand-new or used cars. They offer repayment terms of up to 60 months.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    5.20% to 45.27% (depending on the client; new, existing, & premier)

    15. CTBC

    CTBC Bank focuses on making car financing as simple as possible, offering competitive rates and quick processing times.

    Loan Term

    12 to 60 months

    Down Payment

    Minimum 20% of the car price

    Interest Rate

    Contact the bank for details

    Bottom line

    In short, there are a variety of financing options ensuring that the potential car buyer will find a plan that fits his/her budget and needs. Whether you're looking for quick approvals, flexible payment terms, or low interest rates, these banks have something for everyone. Institutions like BPI, PNB, RCBC, and PSBank stand out for their competitive rates, while others like Sterling Bank of Asia and Robinsons Bank offer great options for both new and used vehicles.

    Also Read: Car loan scams in the Philippines: Applicants be aware

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