Car Loan Terms and Rules that Need to be Understood

Nowadays, the terms for car loans are becoming increasingly stringent. With the increase in the car market in Indonesia, demand and purchasing power is also growing. Especially now that there are financial institutions that provide car purchase facilities using the installment system.

So that the finance company approves your credit application. Several conditions must be met. Although finance companies have quite varied requirements. There is an outline of the requirements that must be met.

Car Loan Terms

The following are several requirements for applying for a car loan,:

1. Document Completeness

When applying for a car loan, make sure to return if you have prepared several personal documents needed for administrative needs. This document is important to streamline the loan process and convince the leasing institution to accept the credit that you apply for.

Some of the documents that are generally requested include:

KTP (Resident Identity Card)
Family card
NPWP (Taxpayer Identification Number)
Electricity bills
Salary slip
Copy of SIUP/TDP for self-employed persons
Checking account
Certificate of domicile.

2. Income According to Credit Installments

When the documents are complete, income requirements are another thing that should not be ignored. If the income you have is not enough to make credit installment payments, of course, your credit application will be rejected.

Not only that, don't forget to count all your other expenses. Don't let your income only be enough to pay for car installments and eventually lead to default if there is an urgent need.

So, what is the minimum salary to be able to apply for a car loan? it's not only about how much salary you have but what percentage of your salary will be paid in installments every month.

Of course, the lender will later see if your cash flow is healthy to meet these monthly payments. The amount of income that can be said to be safe for buying a car is installment payments of 30% of income.

So, if you have an income of IDR 20 million, the maximum car installment cannot be more than IDR 6 million.

3. Advance Payment Preparation

Another thing that must be met is a DP or down payment. The DP given is quite varied, ranging from 0% to 50%. However, a common nominal is 20% to 30%. It all depends on the choices you have and the lender's policies.

Does a large down payment make credit applications easy to approve? Although not always guaranteed, a large down payment shows a big financial commitment and responsibility. Thus, the possibility of approval is getting bigger. Therefore it is important to know the details of the car loan simulation calculation.

4. Credit score

Another car loan requirement that must not be forgotten is the credit score. In Indonesia, this checking system has the name BI checking. Bank Indonesia has an automatic data collection system that uses leasing or bank credit facilities.

Therefore, make sure again that you don't have a problem with credit and have a good credit score. Credit scores are between 300 and 850. This credit score can be said to be good if it is above 720. These results are divided into numbers 1 to 5.

To make a good credit score, make sure that the installments you currently have are paid on time, besides that, make sure you have paid off the debt in your name.

When the car loan requirements have been met and you already have your dream car, don't forget to do regular maintenance. You can do maintenance at an authorized Daihatsu repair shop. Having an online service registration system, you don't have to wait in long queues just to do periodic services.