Overview
MAS introduced maximum limits on loan tenures and amounts to moderate the demand for cars and COEs. These limits also encourage financial prudence and support a car-lite society in the long-term.
Who It Applies To
The maximum limits apply to anyone applying for financing from a financial institution to buy a new or used motor vehicle, where the date of agreement to purchase the vehicle is on or after 27 May 2016.
Exemptions
The maximum limits do not apply to the financing of:
- Motorcycles and commercial vehicles.
- Motor vehicle for people who are physically disabled (PD) or their caregivers.
Loan and Tenure Limits
The financing restrictions are based on the open market value (OMV) of the vehicle:
OMV of motor vehicle | Maximum LTV | Maximum loan tenure |
---|---|---|
Less than or equal to $20,000 |
70% |
7 years |
More than $20,000 |
60% |
7 years |
Note: LTV is the amount of loan expressed as a percentage of the purchase price of the motor vehicle. The purchase price includes relevant taxes and COE price.