Here's How Much You Should Be Earning If You Want to Buy a Car

PHOTO BY Shutterstock ILLUSTRATION War Espejo

Most people have tightened their purse strings during the pandemic, but even those willing to make big-ticket purchases like cars now find new roadblocks on their way. In September 2020, during a virtual press conference, Kia Philippines' president shared that banks are clamping down on auto-loan approvals.

Top Gear Philippines reached out to the Bank of the Philippine Islands to ask about car loans during the time of the pandemic. Dennis Fronda, head of Bank of the Philippine Islands' Retail Loans, shared that while the basic requirements have not changed, "we have aligned our loan evaluation processes based on the current environment. We took into consideration the jobs, businesses, and industries that were greatly impacted by the pandemic."

Also read:
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The COVID-19 pandemic has taught us to take care not only of our health, but also of our financial health. So, with the majority of the country still under some form of quarantine, and with mass transportation still limited, it seems like a good time for the average Filipino salaryman to consider getting a vehicle. But how much should you be earning in order to afford a brand-new vehicle?

"A gross monthly income of around P40,000 will be enough to sustain the amortization payments on a starter car," says Fronda. "Buyers must note that the stability and reliability of their income sources are just as important as the amount when they're assessing their readiness to buy a car."

So, if you are nowhere near that bracket, step back and assess your financial situation and maybe wait till the economic situation is better or your financial standing improves. Another option is to purchase an alternative mode of transport like city bikes under P10,000 or even electric kick scooters. 

This story originally appeared on Topgear.com.ph. Minor edits have been made by the SPOT.ph editors.

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Source: Spot PH