Extended Car Loan Repayment Period for COE Car Loans

This is the way to drive on the smallest possible amount by yearly depreciation!

Considering that, for most everyday drivers, the car is used to get from point to point without having to squeeze with crowds on public transport and if cost savings is a priority, then it’s good news to know that a COE renewed car is always the cheapest method to be on the road without straining the budget.

Since the MAS announcement at end of May 2016, allowing for extension of loan repayment period as well as raising of the LTV (loan to value), this good news for those intending to get a car loan also applies to those who wish to take a loan for COE renewal cars.

The higher loan amount and the longer repayment period also applies for cars above 10 years! So yes, you can take a loan for up to 7 years for a COE car (cars greater than 10 years old are referred to as COE cars by vehicle traders and finance institutions providing vehicle loans)!

Do note that loans cannot be longer than the COE period so if you have chosen a 5 year renewal, then the loan is still only up to 4 years.

However, for those going for renewal, I have to say it makes sense to renew for 10 years rather than for 5 years.

Two facts underline our recommendation:

• Anytime you wish, you can choose to de-register and sell or export your car and claim back, pro rated, the unused portion of the COE from LTA. This cash amount is guaranteed and you can check the amount at this page after keying in the required car plate and owner’s info.
• The PARF value is forfeited in order to renew the COE and if you only renew for 5 years, know that you are legally obligated to scrap the car at the end of the 5 years. No further COE extension is allowed! What a waste, especially if your car is in good condition. So a 5 year renewal increases your yearly depreciation, because you have less years of life in the car.

There are more reasons why 10 years is a good bet, especially if the car is in good condition. Do contact us using the form on the right, we can discuss more before you make a choice to own a COE renewed car.