How to calculate breakeven point of loan vs car value?

[Viper0419]

Hi everyone,

 

not sure this has been asked before, therefore please be patient.

 

can anyone please share on how to calculate the break-even point for your car loan (rule of 78) versus the value of your car.

for example, if i am on 7 years loan, based on the amortization of the loan versus the parf/coe (whatever) value, how to calculate at which juncture will you not need to top up any money and the dealer will take in the car at the loan value. I know all cars are different in re-sale value and also dependent on the interest rate, therefore any calculation will be great.

 

thanks in advance.

 

cheers!

[Ajedi72]

U can refer to this site ...

 

http://www.dbs.com/sg/personal/loans/car/#rateoffer

[Chongster]

the rule of 78 only gives u half the picture. the other half being what you can get for your car.

[Mzrmazda3]

Bro, it's very hard to judge

 

Your 7 years loan is full loan of the car price or 70%, 60%, 50% ... etc?

 

Selling price of your ride would also depends on the market sentiments at the time you are going to sell

[Viper0419]

correct, but i think the what the resale agents does is get the parf value + certain % for body.

[Guyver]

Very hard to calculate ...

 

Whatever you get is based on "NOW".

 

Because for "Market Value" .... it changes.

 

So maybe now .... you breakeven .... maybe later .... you might not.

 

Or maybe now you don't breakeven .... but later .... you may.

 

So .... don't bother about breakeven until you wanna change car.

 

Even if you need to change car .... and you haven't breakeven .... you'll still change if you can afford it.

 

So the final question is ..... Do you want to change car yet?

[Drumstick]

  Quote

Hi everyone,

 

not sure this has been asked before, therefore please be patient.

 

can anyone please share on how to calculate the break-even point for your car loan (rule of 78) versus the value of your car.

for example, if i am on 7 years loan, based on the amortization of the loan versus the parf/coe (whatever) value, how to calculate at which juncture will you not need to top up any money and the dealer will take in the car at the loan value. I know all cars are different in re-sale value and also dependent on the interest rate, therefore any calculation will be great.

 

thanks in advance.

 

cheers!

 

 

Just use a basic calculation. More or less will be there.

 

Car balance COE+paper ( Its standardise, will not run )

Body (depends on market demand )

 

Balance Loan ( Check when you want to do full settlement )

Will have a small rebate for early settlement. ( Will be slightly lesser than 100% of the full installment you gona pay with interest ) *Quite minimum difference unless you do a very early settlement and will save in the interest rebate.

 

Therefore, would be safer if you use total balance installment unpaid as the Loan balance. Dun count in the rebate for early settlement.

At least that will be the max amount needed to pay to the finance company. Give yourself a gap to play around with. 0.8% of balance loan, that will be the rebate +/-.

 

Judging by my previous ride:

85% - 7yr loan.

3rd yr export out, Still need to top up around $6k.

 

If you take 70% loan - 7yrs, by the 3rd yr, should be break even with no topups.

 

Hope this helps.