Loan Guide

New vs Used Car Loan Philippines

Side-by-side comparison of New car (5.49–15% starting rate, lower rates) vs Used car (8–22% starting rate, lower SRP). This guide breaks down interest rates, loan terms, down payment requirements, approval speed, and total cost of ownership for Philippine car buyers in 2026.

Interest Rate

Varies by lender

Loan Term

12 – 60 months

Down Payment

20%

Processing

3 – 7 business days

Requirements

Valid government-issued ID (passport, driver's license, or UMID)

Proof of income (latest 3 months payslips or ITR)

Proof of billing address (utility bill dated within 3 months)

2 x 2 ID photo

Certificate of Employment with compensation details

Latest 3 months bank statements

Pros & Cons

Advantages

  • New car offers rates from 5.49–15% — lower rates.
  • Used car offers rates from 8–22% — lower SRP.
  • Both options allow 20% minimum down payment for brand-new vehicles.
  • This comparison saves you time by consolidating rate, term, and requirement data.
  • Clear winner identified for different buyer profiles (rate-sensitive, convenience-focused, low-income).

Drawbacks

  • New car maximum rate may reach 16% p.a. on longer terms or used cars.
  • Used car maximum rate may reach 16% p.a. under less favorable conditions.
  • Neither provider guarantees the advertised starting rate — actual rate depends on credit assessment.
  • Switching lenders mid-term incurs pre-termination penalties of 3–5% of the remaining balance.

Frequently Asked Questions

Which is better, New car or Used car auto loan?
New car starts at 5.49–15% (lower rates), while Used car starts at 8–22% (lower SRP). The best choice depends on your priorities — rate vs. convenience vs. bundled benefits.
What is the New car auto loan rate in 2026?
New car auto loan rates start at 5.49–15% for qualified borrowers with brand-new vehicles and shorter terms.
What is the Used car auto loan rate in 2026?
Used car auto loan rates start at 8–22%. The actual rate depends on your income, credit history, and vehicle age.
Can I switch from New car to Used car mid-term?
Yes, through refinancing. You would apply for a new loan with Used car to pay off the New car balance. Pre-termination fees of 3–5% may apply on the original loan.
How do I choose between two car loan providers?
Compare the total cost of the loan (not just the rate). Calculate total interest paid over the full term, add fees, and factor in convenience (branch access, online tools, approval speed).

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New vs Used Car Loan Philippines

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