There are many little secrets about COE renewal – we get asked these question quite often by people who are wondering about renewal of their COE – these are some of the common questions we get asked, and our answers. Maybe you will find this information useful.
When should I renew my COE?
It’s quite obvious that you only need to consider renewal of COE when the ten year mark (or five year for commercial vehicles) is close. But as the month of expiry comes closer, most vehicle owners get more confused about when to go for it. Some renew on their expiry month, which may not be unwise, but sometimes, that is not the most advantageous.
This is because the LTA allows you to renew your COE for the vehicle before it expires, at any point in time while it is still registered and on the road. If say the COE falls to a ridiculously low level, it can be wise to renew a few years before expiry. That was the situation available for some when COE prices fell to $1 and $50, making the renewal price very attractive. Some smart owners went for it. The only caveat is, your new COE of ten or five years will start counting down on the month following the renewal and does not add to the existing COE life, as some people think.
But without such fluke prices as the $1 COEs, is it still wise to renew early? More commonly, you can renew at one to three months before the actual expiry date. If there is an uptrend, which can make the early renewal of the COE lower than on the actual month of expiry, you can end up with some savings. However, do note that the forfeited old COE remaining has some value and it would be wise to take this into account but calculating its value. If you are unsure, give us a call or contact us using the form on the right of this page.
You can also take a look here at this article for more details.
Should I renew my COE for 5 or 10 years?
As it will be different for different people, we cannot provide too general an answer for this,.
It is dependent upon the factors that each vehicle owner faces, and they are bound to be different. Consider the following for a summary of points to think through before deciding between five or ten year renewal, or even not at all:
What sort of vehicle are you renewing?
Whatever the vehicle you are renewing, these points should be in your favour – one, spare parts are easily available from more than one source other than the main distributor of this brand, and second, there should be competent workshops also able to do the repairs. These two factors can make it cheap to repair should the need arise.
Most Japanese and Korean vehicles are good candidates for renewal because of the above points. And these cars can easily last the next 10 years if cared for.
Are there any expected upcoming repairs?
Take a look at your vehicle’s state of repair, maintenance, and mileage. If it is low mileage, well maintained with most wear and tear parts already changed, then it would be a good choice for renewal.
Is your PARF value high?
The PARF value is “paid” to the LTA when a vehicle is renewed at the 10 year mark, and so it should play a part in your calculations.
It would be wise to add the PARF to the PQP to be paid and divide it by 10 (if you renew it for 10 years) or divide by 5 if you do a five year renewal to find your yearly depreciation after renewal.
Compare this figure with the yearly depreciation of a new car to see if it is worthwhile to renew or change to a new car for similar depreciation.
Do you foresee yourself driving after five years?
If you do not go for a new car, and have decided to renew the COE based on the above considerations, then we would recommend going for ten year renewal instead of five for the following reasons.
If in five years you plan to change to a new car, it is better to renew for ten years. Wait, what? Yes, true, because the resale and trade in value of a car when, for example, it reaches 14 years old, with 6 more years to go will be higher than one which only has one year to go and which, without exception, must be scrapped when it reaches fifteen years old. So you can squeeze out more upon trade in or a direct sale to the next owner!
Many dealerships and distributors also offer over-trade if you have a car to pass to them, benefiting you by a few thousand dollars. Way better than driving to the scrap yard at fifteen years and getting $250.
What are the ways I can renew my COE?
There are a few ways to renew your COE:
Payment by cheque or cashiers order directly at LTA – easy, just take a queue and wait for your number to be called at the counter. The friendly staff will assist you with the process. LTA does not offer instalment payments and PQP must be paid in one lump sum.
Renewal via post is also possible – visit One.motoring here for details on how to do so and the form to download, fill, sign and post.
You can also choose to renew online at this site: //vrl.lta.gov.sg/lta/vrl/action/pubfunc?ID=RenewCOE
This article here from One.motoring will help you understand the process. However, do make sure your internet banking limit is sufficient to pay for the full PQP amount, as otherwise the transaction may not go through smoothly. Contact you bank on how to increase your transfer or payment limits.
And the easiest way? Contact SG Cash N Cars to do the entire process for you, including PQP monitoring, loan applications, queueing for transaction pin, sourcing for insurance quotes from multiple insurers, purchase of cashier’s order, payment at LTA with appropriate Q02 form, payment of road tax, vehicle conversion from OPC to normal (if desired), Z type to N or vice versa (if desired), making of new number plates (if required) and so on. One stop at our office and we will do the entire process for you!
How do I get the best loan to renew my COE?
Ask an expert, like us, to know what is out there in the market – the part of the finance industry that will extend loans to you for this purpose includes well-regulated banks, to in-house loans, to individual small money lenders who will extend personal loans to you for an amount sufficient to cover PQP payment.
Which one do you choose and what are the differences?
Interest rates and admin fees are only the tip of the iceberg – if you think the difference between 2.88% by certain in-house companies and 3.18% from the banks and other finance institutions is a big difference, think again. The actual cash difference is $3 plus per month between these two loan interest rates for a five year renewal 60 month loan, based on July 2018 PQP for Cat A! Yes that adds up to about $180 over 60 installments but it is small when compared to other terms and conditions that you may be saddled with.
We have reason to say the 3.18% loan is actually going to be cheaper over the long term than the 2.88% loan.
Why? Call us to find out more. We cover a range of financial institutions from banks to in-house, and we will find you the most suitable one in your situation.
Perhaps the above has helped you to understand a bit. But should you have any further queries, you can always contact us through the web form on the right or call us at 92782880.