RT Cunningham


I Paid My Car Loan Off Nearly Two and a Half Years Early

car loan I bought my car in October of 2015. I wrote about my car loan here. Today, I paid it off.

To explain how I did it would take more effort than it’s worth. I don’t have the original paperwork in front of me to see the original car loan price. I only know that I paid about 301,000 pesos (around $5700 USD at the current foreign currency exchange rate) to close it out.

It will be My Last Car Loan in the Philippines

After I bought the car in 2015, I learned of a real age discrimination issue. If the auto loan application requirements at Philippine National Bank are any indication, I won’t be able to get another car loan if the loan period takes me to the age of 66 at any bank in the Philippines. While other banks I looked up don’t have it listed online, I’m sure they discriminate in most of the same ways.

To be honest, I don’t really care. I have yet to drive the car I just paid the car loan off for. Josie (my wife) hasn’t driven it much (less than 100 times, I’m sure). A male bilas (a sister-in-law’s husband, Alex) drives it more often than anyone. He’s our driver when he’s not driving his taxi.

Perhaps I’ll take steps while Josie and I are on our United States visit to set up an alternate loan source (like Navy Federal Credit Union or USAA). I doubt I’ll even think about it after I leave this place.

The Pay Off Amount was Higher than I Expected

That’s because I had to pay a prepayment penalty, listed as a service charge on my final statement of account. My total savings is only 30,000 pesos in unpaid interest. I don’t remember the exact amount of the “service charge”, but my total savings would have been more than 50,000 pesos without it, or more than $1000 USD.

If I’m not mistaken, prepayment penalties are all but extinct in the United States. Unfortunately, banking practices in the Philippines are sorely behind the times. I still can’t make online payments for any services that don’t accept debit cards (which is almost all of them).

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By RT Cunningham
May 16, 2018
Personal Finance