Auto Loan
Congratulations! You are about to start off with one of life's most exciting and memorable journey - buying your dream car.
At DBS, we are able to take the most complicated component of vehicle purchase - your car loan - and make it SIMPLE & EASY!
Feel free to refer to Consumer Tips and check out what you need to know about DBS car loan and our competitive interest rate offer!
DBS Car Financing Package
Fixed Rate Flat Add-On Loan Scheme
This scheme allows you to plan your finances with certainty. Any interest rate fluctuation will not affect your monthly repayment.
Eligibility
Applicable to both New / Used passenger vehicles.
Period of Financing
Maximum of 10 years. For used passenger vehicle, age of car plus period of financing must not exceed 10 years.
Interest Rate
Fixed Rate Flat Add-On. Please refer to our Interest Rate Offer.
Payment Schedule
Monthly instalment payable in advance.
Partial Redemption
Not available.
Full Redemption
Anytime. Please refer to Consumer Tips for more details.
Interest Rate Offer
| New Passenger Vehicles |
| Period of Financing |
Customer Interest Rate |
Effective Interest Rate (p.a.) |
| 1 year |
3.25% |
7.043% |
| 2 years |
3.25% |
6.666% |
| 3 years |
3.25% |
6.505% |
| 3 years |
3.25% |
6.505% |
| 4 years |
3.25% |
6.396% |
| 5 years |
3.25% |
6.309% |
| 6 years |
3.25% |
6.234% |
| 7 years |
3.50% |
6.611% |
| 8 years |
3.50% |
6.540% |
| 9 years |
3.50% |
6.474% |
| 10 years |
3.50% |
6.412% |
Consumer Tips
Car Loan Under Hire Purchase
When DBS grants you a car loan, you are entering into a "hire purchase". DBS owns the car until you have paid up all amounts owed.
Interest Rate Computation Under Flat Rate Basis
Fixed Rate Flat-Add-On means that the interest rate and your monthly loan instalment remain the same throughout the duration of your loan. This protects you against any interest rate fluctuations.
Illustration 1
Suppose you take a loan of S$50,000.00 over 7 years at an interest rate of 3.50%. The computation would be as follows:
- Total interest payable over 7 years
S$50,000.00 x 3.50% x 7 years = S$12,250.00
- Monthly instalment
(S$50,000.00 + S$12,250.00) / 84 months = S$741.08
Computation For Loan Redemption
For any standard Hire Purchase car loan scheme, you are required to pay all principal and interest that would have accrued over the entire loan period. However, in the event you decide to repay the outstanding loan before the loan period ends, you will receive a rebate on the interest.
The interest rebate will be calculated by the method of Rule of 78 less 20%. This is to cover some of the costs which the bank will incur when a loan is repaid early.
Suppose your loan is S$50,000.00 over 7 years at 3.50%. If you repay the entire loan outstanding after making 36 monthly instalments, the computation is as follows:
| Computation For Loan Redemption |
| Original Loan Amount |
S$50,000.00 |
| Total Interest (based on illustration 1) |
S$12,250.00 |
| Total payable (principal + interest) |
S$62,250.00 |
| Less : instalment paid (S$741.08 x 36) |
(S$26,678.88) |
Less : Rebate of Unearned Interest
Using Rule of 78 method (less 20%)+ |
(S$3,228.24) |
| Total amount payable to bank to fully redeem your loan |
S$32,342.88 |
+ Formula for Rule of 78 Method (less 20%)
| |
n (n + 1) |
|
48 (48 + 1) |
|
| R = |
------------- |
x TC x 80% = |
----------------- |
x S$12,250.00 x 80% = S$3,228.24 |
| |
N (N + 1) |
|
84 (84 + 1) |
|
| Where: |
| R |
represents the interest charges rebate |
| n |
represents the balance loan period expressed in months |
| N |
represents the original loan period expressed in months |
| TC |
represents the total amount of interest payable over the loan period |
For assistance on your Auto loan, please call our loan specialists at 6333 0033 or email us at personalfinance@dbs.com.