Published on September 7, 2021

Expat car loan: Tips for foreigners in Singapore to buy a car

Expat Car LoanFinance Company SingaporeNew Car FinanceVehicle Finance Solutions

As an expat in Singapore, you’re probably thinking about whether to get a car for commuting around the island. Though Singapore’s public transport system is highly efficient, there’s still nothing that beats the convenience of having your own car. 

Given the fact that the prices of cars in Singapore are very high, you may not be willing or afford to pay the full amount. Fortunately, there are many finance companies in Singapore offering a range of vehicle finance solutions, such as expat car loans to make car ownership a breeze for you. Here, we discuss the steps you can follow when buying a new car in Singapore, along with some tips that we think you should know.

1. Research

Before buying a car, whether used or new, it’s important to identify your needs before deciding on the type of vehicle you are looking for. For instance, if your family does not have a car right now, you may want to opt for a family sedan or an SUV with sufficient carrying capacity as compared to a convertible. 

On the other hand, if you are currently single and do not foresee yourself settling down anytime soon, then you’ll have more options to choose from. Ultimately, you have to first decide what you want out of your car – a practical family car that you can use in the long run when you have children eventually, or a small sedan for your daily commute. 

2. Understanding what the Certificate of Entitlement is

COE, short for Certificate of Entitlement, is a quota license that you have to bid for. This is a part of Singapore’s Vehicle Quota Scheme (VQS) to manage the number of vehicles on the road.

Should you decide to buy a brand new car, it will come with a COE that expires in 10 years, however, buying a used or secondhand vehicle will come with an existing COE that you can continue driving for the remaining term left. For instance, buying a three-year-old car would mean you can still drive it for a good seven years. 

However, once the COE is up, you can either choose to scrap the car and take the Preferential Additional Registration Fee (PARF) rebate or simply renew the COE again.

Car Financing in Singapore by Car Dealer
Car Financing in Singapore by Car Dealer

Although you can always bid for the COE on your own, it is best to leave it to your dealer so that you do not have to go through the hassle of doing it yourself. Usually, the agreed price of your new car will include the COE, hence you do not need to fret about having to pay extra.

3. Costs of owning a car

While the most obvious cost is the price of the car, there are also other fees that you need to pay. 

If you take up a car loan with a vehicle finance company in Singapore, you’ll need to factor in the costs of monthly interest as well. Most finance companies in Singapore like Swee Seng Credit, work with local banks to offer competitive rates to all their clients; they also have in-house loans that help you with all the necessary paperwork and flexible loan amounts as well. 

On top of that, with motor insurance being mandatory in Singapore, having a comprehensive plan may cost you approximately $1,500 annually. Furthermore, there’s also the regular servicing that needs to be done to maintain your car, petrol, parking, as well as Electronic Road Pricing (ERP) that you need to pay when driving on the roads of Singapore.

ERP Singapore
ERP Singapore

As the cost of owning a car is high in Singapore, you will most likely need a car loan to finance your vehicle. The eligibility criteria for car loans depends on the lenders, as such, it is always best to check with them individually. Besides taking up loans from popular banks, you can also consider other finance companies in Singapore like Swee Seng Credit. 


Upon confirming your eligibility for taking up a car loan, you will then be required to submit your proof of identity, income, work permit, or employment. According to the Monetary Authority of Singapore, you can loan either 60% or 70% of the cost for up to seven years. However, this amount is also dependent on the model and type of car you are getting. 


Unfortunately, fully financing your car is no longer available since 2013. Instead, you are required to pay at least 30-40% of the price of the car on your own. The maximum car loan term in Singapore is seven years. When it comes to choosing how long you would like to take to pay back the loan, it is best to consider the total amount of money you end up paying vs the monthly amount you can afford to pay. 

For instance, car loan plans with a longer repayment term let you pay less per month, however, you may end up with more interest to pay at the end. As such, a longer-term loan is more suitable if you have a limited monthly income to work with. 


In addition, some banks and finance companies in Singapore offer different loan structures, rates, and prerequisites. Hence, it is always best to take up vehicle finance solutions from a reputable financial institution. You can always use our loan calculator for an estimate of the monthly repayments required for your car. 

Owning a car in Singapore as an expat does not require you to break the bank. Visit Swee Seng Credit to find out more about the competitive rates we offer for car loans and let us help you make your stay in Singapore much more convenient.