We test drove and bought the car today, thanks for the help, people!
The interest rate of course wasn’t 0%, not sure that was bait and switch or a miscommunication. It was 3.75% for a conventional (4 year) loan, or you could pre-pay 2 years worth of interest at 2.4%, and pay it off in 24 months (worked out to 18,000 in interest up front). We chose that route. We had a local taiwanese friend helping with negotiations, thank god!
I’m not sure, and all the discussions were in Chinese. After we agreed to the deal they brought over the finance guy, but they didn’t ask any questions before offering the loan. It could be we could have been denied after the fact. They just asked for things like our income, job title etc. we don’t even have a local credit card so I guess it’s not important.
They have the car as collateral, so it’s not unsecured like a credit card.
This is false. The USA isn’t ‘anywhere in the world’. It actually harms your credit in many countries.
I recently got a vehicle loan for a new motorcycle. All they needed was the vehicle details, ARC and passport. They did not check my credit history. It is through Yu Rich Financial Services Company but was applied for through a dealer. It was interesting because the interest was calculated using fixed simple interest rather than variable compound interest. They gave me a discount on the interest because I had a guarantor.
I borrowed about $125,000 over 12 months, they only charged about $4,000 on top as interest and I repay a set amount each month. My motorcycle cost $190,000, I paid $65,000 up front.
It was a Kawasaki dealership in Yuanlin. The finance company couldn’t give 2 sh*ts about my income, credit worthiness or my foreigness they just called for me to verbally agree to the loan and that was that (i just say hao hao a few times). Then they called my guarantor to do the same.
It was a 5 minute process getting the loan. The owner of the dealership is a bit slow but nice and helpful enough.
Thanks, yeah, I’d never heard of pre-paid interest, and initially said no. They dropped it from 3 to 2 years at the same 2.4% rate, and also there’s a prepayment penalty in the first 12 months if you take the 3.75% conventional loan. So the pre-paid seemed the best route. Paying cash would have been difficult since our money is still in the US and wire transfer seems to be taking 2 weeks or more.
I also only heard this year about pre-paid interest loan, and after checking the details, we decided to take it.
The lowest interest we got in conventional loan was 2.7%, while pre-paid interest was around 1.7%, a big difference!
Normally the dealership has an agreement with a finance company. When I bought my Ranger in Aug 2015 I got 5 year warranty. Made a deposit of NT$400,000 the loan was for NT$1.2 million and 22K a month repayment. It was an interest loan can’t remember what is was but interest rates then were very low. I really just wanted the loan for credit history.
I used my HSBC HK PDF files from account in my Chinese name to show assets and income.