Car loans: how much you can borrow
The Monetary Authority of Singapore limits car loans by the OMV of the car. Rules read on 24 October 2026; type the rate a bank or dealer quoted you.
Monthly instalment over 7 years
$1,777
Within the 60% limit
| Largest loan allowed | $123,356 |
| Down payment | $82,238 |
| Total interest | $25,905 |
| Effective yearly rate | 5.57% |
Flat rate: interest on the full loan for the whole tenure, so the effective rate is close to twice as high.
Prepared by Radif Partners · Method · COE results read on 24 October 2026 (latest: 2nd exercise of October 2026)
A car loan in Singapore is capped by the Monetary Authority of Singapore. If the car’s OMV is $20,000 or less, you may borrow up to 70% of the purchase price; above that OMV, up to 60%. The tenure cannot exceed 7 years. The purchase price includes the taxes and the COE, so on the Category A car at $205,594, whose OMV is above the line, the largest loan is $123,356 and the cash down payment at least $82,238. Banks and dealers quote flat rates, which charge interest on the full amount for the whole tenure: at an example flat rate of 3.00% over 7 years, that loan costs $1,777 a month and $25,905 of interest, an effective yearly rate of 5.57%. The calculator does the conversion for the rate you were quoted. The limits do not apply to motorcycles or commercial vehicles.
The two limits
Since 27 May 2016, MAS rules cap the loan to value of a car loan by the OMV of the car: up to 70% of the purchase price when the OMV is $20,000 or less, up to 60% when it is higher. The maximum tenure is 7 years for both. The rules cover loans for private cars, whether the lender is a bank or a finance company; motorcycles and commercial vehicles are outside them.
The line at $20,000 of OMV creates a step. A car with an OMV just at the line and a price of $150,000 can borrow $105,000; a car with a slightly higher OMV and the same price can borrow only $90,000. The difference, $15,000, has to be found in cash, so it pays to check on which side of the line a model sits before choosing between two versions.
Down payment on the two example cars
The Category A car used on this site, at $205,594 before the dealer’s margin, has an OMV of $30,000, above the line. Its largest loan is $123,356 and its down payment at least $82,238. The larger car at $304,231 needs at least $121,693 in cash. A real quote adds the dealer’s margin, which raises both the price and the loan limit by the same share.
The cost per year of the car you are financing
Cost per year over 10 years
$21,071
| OMV | $30,000 |
| Excise duty and GST | $9,240 |
| ARF after VES and EEAI | $34,000 |
| COE, October 2026 (2) | $132,004 |
Tenure and interest
| Tenure | Monthly | Total interest | Effective rate |
|---|---|---|---|
| 3 years | $3,735 | $11,102 | 5.68% |
| 5 years | $2,364 | $18,503 | 5.64% |
| 7 years | $1,777 | $25,905 | 5.57% |
A longer tenure lowers the monthly instalment but adds interest. It also leaves the loan outstanding for most of the period during which the car loses the bulk of its value. For a car kept 7 years and then sold, the loan ends just as the car changes hands; for one scrapped earlier, the remaining balance has to be repaid before any rebate can be collected.
What the loan adds to the cost per year
Interest is a cost of owning the car like road tax or insurance. On the Category A example, $25,905 of interest spread over the ten years of the COE adds $2,590 a year to a cost of about $21,071 a year in depreciation and road tax, roughly 12% more. Paying a larger share in cash cuts that figure, but the cash then earns nothing elsewhere; the comparison only makes sense against what that money would earn, which the effective rate lets you judge.
Reading a loan quote
Ask for three figures: the flat rate, the tenure and the total amount payable. With those, the calculator above gives the effective yearly rate, the only one that can be compared with a personal loan, a mortgage or a deposit. Check whether the quote includes fees for processing or early settlement, and whether the dealer’s “low rate” offer comes with a higher car price. The rate shown in the calculator by default is only an example; no bank or dealer publishes a rate that this site could quote as current.
Most of the price being taxes and the COE, the loan finances things that partly come back at the end through the PARF and COE rebates. The cost of owning page shows what the car really costs per year once those rebates are counted, and the OMV page what the price is made of.