Higher charges now for purchases of non-national cars.Read the detail news from thestar below:
INTEREST RATES FOR CAR LOANS RAISED
Interest rates on car loans have been raised effective yesterday, car dealers confirmed.
A senior sales adviser with UMW Toyota Motor Sdn Bhd said rates had been raised although he said nothing official had come out from banks as yet.
Most major banks declined to comment when contacted.
However, a random check by StarBiz found that Malayan Banking Bhd (Maybank), one of the largest hire purchase financiers in the country, raised its rates yesterday.
Hire purchase interest rates for new non-national cars (such as Toyota and Nissan) have increased to 3.25% for loan tenures of five years and below, 3.4% for six to seven years and 3.5% for eight- to nine-year loans.
Previous hire purchase interest rates were in the range of 2.4% to 2.5%.
But in the case of new national cars, the opposite prevails. Maybank which used to offer a flat rate of 3.6% for loans up to nine years for Perodua cars and 3.75% for Proton cars, is now offering slightly lower rates. For loans of five years and below the rate is 3.5%, six to seven years (3.65%) and for eight to nine years (3.75%).
Meanwhile, a senior officer at Toyota said: “Interest rates for Toyota cars used to be between 2.6% and 2.8%, depending on the tenure of the loan. The average rate is about 3.2% now.”
However, Toyota has “a special promotion” for its best selling model, the Toyota Vios.
Under the promotion which is valid until the end of this month, interest rates are as low as 1.68% for a five-year loan, 1.78% for a seven-year tenure and 1.88% for nine years.
An Edaran Tan Chong Motor Sdn Bhd dealer who distributes Nissan cars concurred that rates had been adjusted upwards effective yesterday.
“Interest rates were 2.4% to 2.5% before but today (yesterday), we heard that this has been increased to 3.2% for a five-year loan and 3.4% for seven years,” he said.
An analyst with a local stockbroking firm expects hire purchase interest rates to stabilise, going forward.
“Raising hire purchase rates will help banks to protect their margins. Credit risk is also higher in the current economic slowdown and this must be priced in as well.
“Competing via interest rates is not a good way. The rates are low already. How much lower can they go?” the analyst said, adding that interest rates for new national cars were higher than for new non-national cars.
This was because the credit risk was traditionally higher as the target customer segment of national cars was the lower to middle income group, she noted.