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> Buying New Car: Loan or Full Settlement?, Need Advice

What are your suggestion to buy the new car?
 
Take car loan [ 25 ] ** [67.57%]
Full settlement/payment [ 12 ] ** [32.43%]
Total Votes: 37
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TSDesch P
post Feb 20 2020, 01:45 PM, updated a long time ago

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I have been working for several years.
Being thrifty, I have been able to save up $$$ over the years.
Currently using 2nd-handed Kancil.
I plan to purchase Perodua Axia (cost ~ RM 3X k) by this year.

I would like to seek advice/opinion from you all.
If you have more than enough savings to purchase a car without loan, after buying the car you still have sufficient $$$ to handle family emergencies just in case.
Do you prefer take loan then invest the $$$ in FD or others,
or settle with full payment for the car?
And what are your reasons?

I appreciate your opinion/advice.
Thank you.
xAmdx
post Feb 20 2020, 01:50 PM

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QUOTE(Desch @ Feb 20 2020, 01:45 PM)
I have been working for several years.
Being thrifty, I have been able to save up $$$ over the years.
Currently using 2nd-handed Kancil.
I plan to purchase Perodua Axia (cost ~ RM 3X k) by this year.

I would like to seek advice/opinion from you all.
If you have more than enough savings to purchase a car without loan, after buying the car you still have sufficient $$$ to handle family emergencies just in case.
Do you prefer take loan then invest the $$$ in FD or others,
or settle with full payment for the car?
And what are your reasons?

I appreciate your opinion/advice.
Thank you.
*
I share the same situation as you but IMO, I will go for car loan but not max 90%. Maybe 60-70% loan, reason behind is new car interest is low and you can keep the money in the saving/FD/investment or save it for raining days. I choose this also I want to build up my credit rating with the banks as I do not have credit card or any loan. Its make me harder to get house loan in future.
fun_feng
post Feb 20 2020, 01:58 PM

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If u have to ask, I assume u dont know about any other low risk investment that could give u better return than the HP loan....
But u r wary of pay lump sum in case of good opportunity that comes up...

So the best thing is just to pay 50% d/p and 50% loan...
jaycee1
post Feb 20 2020, 02:13 PM

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QUOTE(Desch @ Feb 20 2020, 01:45 PM)
I have been working for several years.
Being thrifty, I have been able to save up $$$ over the years.
Currently using 2nd-handed Kancil.
I plan to purchase Perodua Axia (cost ~ RM 3X k) by this year.

I would like to seek advice/opinion from you all.
If you have more than enough savings to purchase a car without loan, after buying the car you still have sufficient $$$ to handle family emergencies just in case.
Do you prefer take loan then invest the $$$ in FD or others,
or settle with full payment for the car?
And what are your reasons?

I appreciate your opinion/advice.
Thank you.
*
Take a car loan regardless, as per your reasons above.

But you can op for higher downpayment and/or shorter term (if cash flow permits). Ideally you don't want to take more than 5 years.
Yggdrasil
post Feb 20 2020, 02:23 PM

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QUOTE(Desch @ Feb 20 2020, 01:45 PM)
I have been working for several years.
Being thrifty, I have been able to save up $$$ over the years.
Currently using 2nd-handed Kancil.
I plan to purchase Perodua Axia (cost ~ RM 3X k) by this year.

I would like to seek advice/opinion from you all.
If you have more than enough savings to purchase a car without loan, after buying the car you still have sufficient $$$ to handle family emergencies just in case.
Do you prefer take loan then invest the $$$ in FD or others,
or settle with full payment for the car?
And what are your reasons?

I appreciate your opinion/advice.
Thank you.
*
Pros of paying cash
1. Car is in your name.
2. No need pay stamp duty and other fees for the loan.
3. Easier to get other loans like housing etc approved because no car loan commitment.
4. Less headache.

Pros of getting loan
1. Can make a profit if your ROI is above the loan interest charge.

Personally, I will weigh the pros and cons. If the loan amount you are taking up is small, it might not justify going for a car loan because of stamp duty and other fees.
Since interest rates a low, I would take up the loan instead. With the money saved, I'll put in a diversified index fund that historically generates a return above 5% p.a.



fantasy1989
post Feb 20 2020, 02:39 PM

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i prefer to get some loan instead of full settlement. keep some cash on hand for any unexpected situation
BacktoBasics
post Feb 20 2020, 03:26 PM

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QUOTE(Desch @ Feb 20 2020, 01:45 PM)
I have been working for several years.
Being thrifty, I have been able to save up $$$ over the years.
Currently using 2nd-handed Kancil.
I plan to purchase Perodua Axia (cost ~ RM 3X k) by this year.

I would like to seek advice/opinion from you all.
If you have more than enough savings to purchase a car without loan, after buying the car you still have sufficient $$$ to handle family emergencies just in case.
Do you prefer take loan then invest the $$$ in FD or others,
or settle with full payment for the car?
And what are your reasons?

I appreciate your opinion/advice.
Thank you.
*
Suggest to take loan since IR is low now. take your savings to invest to cover for the HP interest of the car.
blmse92
post Feb 20 2020, 04:02 PM

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Suggest you to take car loan since the loan amount not high, assume you put 10% DP should be okay with month installment. Don't put all cash in it. Dilute your cash elsewhere.
amirulhakimiazman
post Feb 20 2020, 04:04 PM

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I plan to purchase Perodua Axia (cost ~ RM 3X k) by this year.

only axia meh. better loan but onli 5 years or less.
Daddy2be
post Feb 20 2020, 06:47 PM

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Since you saved up your money I assume you're someone with discipline. Car loan is a better option because you do not have a large amount of savings. Keeping some cash is important for emergency and also if there's an opportunity for you invest.


WeiLoonChuak
post Feb 21 2020, 10:53 AM

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FD rate also not very high, perodua car i believe interest is around 2.5-3%, if you are not familiar with investment, it is advisable to buy cash, no point to pay interest for taking loan .... car loan is long term commitment
azbro
post Feb 21 2020, 04:23 PM

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I bought Axia cash for my wife, but if i can remember, it cost a few hundred more than take loan, cos salesman no get commission from bank or something like that
I checked with 2 outlets also same.

Seriously, Axia is no bad, but, myvi is better.
The 3 cylinder engine is very rough, and only gets rougher in time. And you tend to get bullied on the roads.


Better top up and get Myvi.
skyblack4492
post Feb 23 2020, 07:23 PM

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But myvi. Axia too small.
andyng38
post Feb 25 2020, 01:16 PM

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If u can afford it, get a Myvi with 50% loan. Don't get a pootling little Axia for the reasons stated by other posters.
EmpireAnt
post Feb 26 2020, 03:50 PM

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and if you value safety more,

persona/iriz is a the car you should go for instead of myvi (cheaper too)
mango27
post Feb 27 2020, 10:51 AM

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by taking car loan you can free up money for other areas, like investment or house loan...

for me with house loan definitely better to dump money there as amortization loan charge far more interest than car loan... you'll see far more saving in interest from money dump there compared to car loan interest charged...

dont simply take those "smartass" words where buying car with loan is stupid... do your own calculation in excel and compare it yourself...

Mikeshashimi
post Feb 27 2020, 11:00 AM

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Car loan is about 2.5-3.5%?

Some investment opportunities can go up to 5-6% on average?

I'm no expert but wouldn't it be better to not settle outright?
pot-8-O's
post Feb 27 2020, 11:56 AM

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QUOTE(Desch @ Feb 20 2020, 01:45 PM)
I have been working for several years.
Being thrifty, I have been able to save up $$$ over the years.
Currently using 2nd-handed Kancil.
I plan to purchase Perodua Axia (cost ~ RM 3X k) by this year.

I would like to seek advice/opinion from you all.
If you have more than enough savings to purchase a car without loan, after buying the car you still have sufficient $$$ to handle family emergencies just in case.
Do you prefer take loan then invest the $$$ in FD or others,
or settle with full payment for the car?
And what are your reasons?

I appreciate your opinion/advice.
Thank you.
*
You either trap yourself with a loan or burn your hard earned savings in one blow.

Purchasing a car is always a huge if not big commitment, I'll still go the path of loan ... can't bear the possibility of paying one lump sum and end up in an accident totaling the car.
Micozole
post Feb 27 2020, 01:23 PM

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TS, read this..you're welcome : https://forum.lowyat.net/index.php?showtopic=4761887&hl=

 

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