Any person who applies for financing from a financial institution for the purchase of a new or used motor vehicle, where the date of the agreement to purchase the vehicle is on or after 27 May 2016, will be subject to the following restrictions:

* LTV is the amount of the loan expressed as a percentage of the purchase price of the motor vehicle. The purchase price includes relevant taxes and price of the COE.

In 2013, MAS introduced restrictions on motor vehicle financing granted by financial institutions, to moderate the demand for cars and COEs and alleviate inflationary pressures. The measures also served longer term purposes: to encourage financial prudence and to support efforts to promote a car-lite society.

Since then, the contribution of private road transport (excluding petrol) to CPI-All Items inflation has eased from +1.3% points in 2011-2012 to -0.5% point in Q1 2016. The allowable vehicle population growth rate remains capped at 0.25% per annum. However, COE quotas have expanded in recent quarters alongside an increase in de-registrations. Based on current market conditions, MAS is of the view that the motor vehicle restrictions can be adjusted to their long-term sustainable levels.

Non-MAS regulated financial institutions are subject to financing restrictions under the Hire-Purchase (Motor Vehicles) Regulations 2013 administered by the Ministry of Trade and Industry where they extend motor vehicle financing on a hire-purchase basis. These restrictions are similar to those set by MAS for motor vehicle financing granted by MAS-regulated financial institutions.

Licensed moneylenders are also required to comply with MAS’ financing restrictions if they extend motor vehicle financing.

Commercial vehicles and motorcycles continue to be excluded from the financing restrictions. 

Commercial vehicles include goods vehicles (excluding goods-cum-passengers vehicles), omnibuses, school buses, private hire buses, excursion buses, private buses, private hire cars, taxis, and engineering plants (such as a tractor, a road roller, an excavator, a forklift, a dumper, a grader, a concrete pump, a dozer, a loader, a skidder, a compactor, a scrapper, a pipe-layer, a handcraft, a pax step or an airport service equipment). 

You may refinance your outstanding motor vehicle loan up to the full amount outstanding and for a maximum tenure of (7-X) years, where X is the number of years since your motor vehicle loan was first disbursed, if you meet your financial institution’s credit assessment.

For example, if Mr Tan took up a loan with a 50% LTV and loan tenure of 5 years to buy a motor vehicle in June 2013, he may refinance his motor vehicle loan up to the full amount outstanding 3 years later in June 2016, for a maximum tenure of 4 years (i.e. 7 - 3 = 4), if he meets his financial institution’s credit assessment.

You may refinance your outstanding motor vehicle loan up to the full amount outstanding and for the remaining validity period of the COE of the motor vehicle, if you meet your financial institution’s credit assessment.

Example 1
Ms Lim took up a loan at a 100% LTV and loan tenure of 9 years to buy a new car (i.e. COE validity period of 10 years) in June 2012. If she refinances her motor vehicle loan 4 years later in June 2016, she may refinance up to the full amount outstanding for a maximum tenure of 6 years (i.e. 10 - 4 = 6), if she meets her financial institution’s credit assessment.

Example 2
Ms Lim took up a loan at a 100% LTV and loan tenure of 6 years to buy a used car with a COE validity period of 8 years in June 2012. If she refinances her motor vehicle loan 4 years later in June 2016, she may refinance up to the full amount outstanding for a maximum tenure of 4 years (i.e. 8 - 4 = 4), if she meets her financial institution’s credit assessment.

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A physically disabled person and his/her caregivers may continue to apply to be exempted from MAS’ motor vehicle financing restrictions for the purchase of one motor vehicle.

The exemption allows a physically disabled person or his/her caregiver to obtain motor vehicle financing that is above MAS’ financing restrictions, subject to his/her financial institution’s credit assessment.

To qualify for an exemption, you must either be a physically disabled person (PD) or a caregiver of a PD. 

Where you are a PD applying for the exemption, you must meet any one of the following criteria:

• Receiving payout under the ElderShield Scheme
• Receiving payout under the Interim Disability Assistance Programme for the Elderly
• Receiving payout under the Pioneer Generation Disability Assistance Scheme
• Holding a valid car park label issued by SG Enable for permanent disability
• Certified by a Tan Tock Seng Hospital rehabilitation physician to be permanently physically disabled, but medically fit and functionally able to drive safely, where the PD is a driver
• Certified by a fully registered medical practitioner authorized by the Ministry of Health to be permanently physically disabled and require maximal or total assistance in mobility, where the PD is a passenger

Where you are the caregiver of a PD and applying for the exemption –
(a) the PD must meet any one of the criteria in the paragraph above; and
(b) you must meet any one of the following criteria:

• Have the same address on your NRIC as the PD
• Have a familial relationship with the PD (i.e. parent, child, grandparent, grandchild, spouse or sibling of the PD)
• Be a deputy of the PD under section 24 of the Mental Capacity Act (Cap. 177A)

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We encourage you, if you need to obtain a certification by a medical assessor to make an appointment for a medical assessment with the appointed assessor of their choice based on the list of MOH-appointed medical assessors, or if you intend to be a driver of the motor vehicle to be purchased, the Tan Tock Seng Hospital Rehabilitation Centre (located at 17 Ang Mo Kio Ave 9, Singapore 569766, tel: 6450 6181). 

You are advised to check with the clinic on the availability and the cost of the service.  You should bring along a copy of the medical assessment form. All costs of the medical assessment will be borne by you, and additional fees may be payable if further assessment or investigative tests are needed.