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Buying brand new is great but it’s only the easiest way to lose a significant amount of money very quickly. It’s a fairly well-known fact that as soon as you drive your car out of the show room or forecourt, it automatically loses up to a third of its value. For this and many other reasons, people often to choose to buy second vehicles. They’re generally better value and if you are willing to shop around, you can find yourself a bargain. Using personal loans for cars in the Philippines is commonplace, but there are a few ways you can make sure you’re getting the most for your money. Here are some of Asteria’s tips on how to use personal loans to buy second-hand cars in the Philippines.

1. Account for extra costs

When you’re dealing with second-hand cars, extra costs for things like repairs and replacements are inevitable. Though you shouldn’t usually have to carry out any work on a vehicle as soon as you buy it, it makes sense to allow for any breakdowns or problems caused by general wear and tear. When you complete your application for a personal loan, consider taking out slightly more than the cost of the car. This might seem like a strange thing to do at first, but it means that you can keep your car on the road and ensures you are getting the best value from it. Tax and insurance are also important, so make sure to account for these, too.

2. Be wary of deals that seem too good to be true

When something seems too cheap, there’s usually a reason for it. Your vehicle is important and if you are buying a used car from somebody you don’t know, in a country that is not familiar to you, there is the potential for you to be taken advantage of. Make sure that you ask questions about safety features, mileage and previous owners. Though you can use a personal loan in the Philippines to pick up a good quality second car, if you go for the cheapest option you can find without first checking out the other deals, you could end up wasting a lot of money. Repairs on older cars can be expensive and if you have to scrap the vehicle, you may end up quite badly out of pocket. It is possible to find great deals, but always check as thoroughly as you can to make sure it isn’t too good to be true.

3. Avoid spending more than you can afford

It can be very tempting to use personal loans to cover the cost of monthly repayments on expensive vehicles. Obviously, this is fine the short term, but you need to ensure you can continue to cover any costs you agreed prior to the sale. Ideally, you should be able to live comfortably, and the repayments should not cause you any severe hardship. Remember the short-term personal loans can have very high interests, so only ever use these if you are certain you are going to have enough money to pay back what you owe. Though your vehicle is important, it doesn’t have to be a luxury item and splashing out without thinking can have severe consequences for your financial future.

4. Consider Shared Ownership

If you are a couple or have somebody with whom you can share the use of the car with, this can be a great way to get something of a really good standard, without having to pay more than you can realistically afford. A personal loan in the Philippines can range from the equivalent of a few hundred to a few thousand dollars. Sharing a vehicle with another person can mean that you need to borrow less, which will obviously mean cheaper repayments and a smaller amount of overall debt. This option is often popular amongst younger people who live in shared accommodation, but it is also something many married and cohabiting people do, too.

5. Take Your Time and Compare the Market

Salespeople are similar in every part of the world and it you generally won’t find the best value by taking the first deal you come to. It makes sense to shop around and to be non-committal when you’re showing an interest in a vehicle. Though you can say that you may like to purchase the car at a later date, never let somebody pressure you in to making a transaction before you feel comfortable doing so. Unless you have been lucky enough to find your dream car immediately, take the time to compare a few different options while weighing up the pros and cons of everything you’ve seen. Generally, second-hand cars will all have some kind of small problem, so it’s often a case of working out what you’re happy to live with and what you definitely couldn’t stand.

6. Pay as Much as You Can Straight Away

If the car is fairly old and cheap enough, you may be able to purchase it outright, without having to enter into a longer-term agreement. If this is an option, it can work out cheaper than finance, though this will depend on factors such as your credit rating. If you can’t get a competitive interest rate on finance, buying the vehicle outright means you can avoid paying more than you need to. Using a personal loan to help supplement any savings you may have can be a good way to do this and providing you have accounted for the repayments you need to make, it’s a way of owning your own car, even if you have a relatively low budget.


Using a personal loan to buy a used car in the Philippines can help you to afford something a little better than you may be able to pay for using your savings or salary. As with any large purchase, its essential not to rush into anything and to be aware of the potential risks before you enter into an agreement.

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