UOB Car Loan Review (2025): Car Financing Starting From 2.78% Per Annum

In this comprehensive review, we'll delve into the different UOB car loans, including new car loans, used car loans and green car loans. We’ll be exploring their interest rates, loan tenures, eligibility criteria, and  compare UOB car loans with offerings from other banks, helping you make an informed decision and potentially save some cash! 

With a UOB Car Loan, you can borrow up to 70% of the value of your car, or the Bank’s valuation, whichever is lower. Keep in mind that the Open Market Value (OMV) of your vehicle will also have an impact. 

For models with OMV up to S$20,000, the maximum loan quantum is 70% of the car’s value.

However, for cars which have an OMV more than S$20,000, the most you can borrow is 60% of the value of the vehicle.

As for how long you can take to repay the loan, UOB offers flexible loan tenures ranging from one to seven years. So you can choose a repayment plan that fits your budget and lifestyle.

To make an informed decision about your car financing, you have to understand the details of the loan and how much you can comfortably borrow.

Our guide on calculating car loan payments as well as this car loan calculator by sgcarsmart can give you a good estimate on how much you can actually borrow, helping you make informed choices.

When it comes to interest rates, UOB offers different rates depending on the type of car you're planning to buy.

• Interest Rates: 2.78% per annum for new and used cars under 10 years old.

• Loan Tenure: Up to 7 years.

• Maximum Financing:

• Up to 70% of the car's purchase price or bank's valuation (whichever is lower) if the OMV is less than or equal to S$20,000.

• Up to 60% of the car's purchase price or bank's valuation (whichever is lower) if the OMV is more than S$20,000.

• Interest Rates: 2.88% per annum for cars older than 10 years but not exceeding 11 years at the point of application.

• Loan Tenure: Varies based on the COE renewal period.

• Interest Rates: 2.48% per annum for electric vehicles.

• Incentives: UOB may offer rebates or partner with eco-friendly initiatives to promote green car ownership.  

You may use any of the following methods to pay your loan installments:

• Fund transfer

• Telegraphic transfer

• PayNow

• Cash

• Cheque

• Cashier’s Order

• GIRO

To give you a clearer picture of where UOB stands, let's compare their car loan interest rates with those offered by other major banks in Singapore. 

Let's analyse how UOB stacks up against its competitors based on the table:

Where UOB excels:

• Competitive rates for new and used cars: UOB's interest rate of 2.78% p.a. for new and used car loans is competitive, matching OCBC's rate and falling only slightly behind DBS's rate of 2.68% p.a. This makes UOB a solid choice for those looking to finance a newer vehicle.

• Partnership with Carousell: UOB's partnership with Carousell allows borrowers to finance their car purchases made through the platform, adding convenience and flexibility to the process.

Where UOB falls short:

• Higher rates for electric vehicles: UOB's interest rate for electric vehicles, at 2.48% p.a., is higher than DBS's rate of 2.28% p.a. This could be a significant factor for those specifically looking to finance an electric car.

• Higher early settlement penalty: UOB has the highest early settlement penalty among the three banks, which could be a deterrent for borrowers who anticipate paying off their loan early.

When comparing and choosing between car loans, there are several important factors to consider to ensure you find the best option for your financial situation and needs. Here's a comprehensive list of considerations:

• Lower interest rates mean lower overall costs. 

• Compare rates from different banks to find the most competitive option and potentially save thousands of dollars over the loan tenure.

• Longer loan tenures mean lower monthly repayments but higher overall interest paid.

• Choose a tenure that balances affordability with minimising interest costs.

• The LTV limit determines the maximum loan amount you can get based on the car's value. A higher LTV means a lower down payment, but it may also result in higher interest rates or a larger loan amount.

• Consider your down payment capacity and the impact of the LTV on your loan terms.

• Calculate your monthly repayments based on the loan amount, interest rate, and loan tenure. 

• Ensure the repayments fit comfortably within your budget and financial obligations.

• Factor in additional fees and costs, such as processing fees, early repayment fees, and late payment charges. These can add up and significantly impact the overall cost of owning a car.

• Compare fees across different banks and choose a loan with transparent and reasonable charges.

• The type and age of the car can affect the loan terms and interest rates.
• Newer cars and electric vehicles may qualify for lower rates or special loan packages.

• Loan approval time can vary between banks.

• If you need quick access to funds, choose a bank with a faster loan approval process.

UOB doesn't publicly disclose a lot of the important fees and charges, but I was able to find this:

• Processing fee for change of instalment date: S$1,000

Other important fees and charges to know include: 

• Late payment charge

• Loan processing fee

• Early redemption fee

Be sure to clarify the above items with your car dealer, as well as any other charges and fees that you may be subject to.

Car ownership in Singapore is very expensive. So it is smart to find ways to reduce the cost. One way is researching and finding a car loan with the most competitive interest rate. Another money-saving tactic is shopping for car insurance that provides the best benefits that match your driving needs at the lowest premium possible. Compare car insurance rates and coverage easily by filling up the form below.

If you want to fully pay off your outstanding car loan with UOB early (known as early redemption or early repayment), you will need to pay an early redemption fee.

The specific amount of the early redemption fee depends on your remaining loan amount and original loan length. For the most up-to-date fee amount, it's best to contact UOB directly.

To avoid surprises, plan ahead and get the exact early redemption fee amount from UOB before paying off your loan early.

Early settlement of a car loan can be tempting, but it's crucial to weigh the pros and cons before making a decision.

Pros:

• Interest savings: Reduce the total interest paid over the loan term.

• Reduced debt: Eliminate monthly repayments and free up cash flow.

• Full ownership: Gain complete control over your car.

Cons:

• Early settlement penalty: Most loans have penalties, which can be substantial, especially with UOB.

• Opportunity cost: The money used to settle the loan could potentially earn more if invested elsewhere.

• Minimal savings for flat interest loans: Early repayment may not yield significant savings for these loans.

Key considerations:

• Loan terms: Review your loan agreement for penalties, restrictions, and notice periods.

• Financial situation: Ensure you have sufficient funds for emergencies after settling the loan.

• Investment alternatives: Compare potential interest savings with returns from other investments.

• Loan type: Understand the interest calculation method (flat vs. reducing balance) to assess potential benefits.

• Remaining tenure: If your loan term is almost over, the interest savings might not justify the penalty.

Early settlement can be a smart move if:

• You have surplus cash and want to reduce debt.

• The early settlement penalty is low or nonexistent.

• Your car loan's interest rate is high compared to other financial commitments or investment opportunities.

If you’re ready to apply for your car loan application with UOB, here’s how to get started:

You’ll need to apply for this loan through your car dealer or via Carousell (if that’s where you’re buying your car from). Those who have Singpass can use MyInfo for a smoother application process.

Alternatively, you may download the Car Loan Application form and mail it in it to UOB directly, along with the required documents. See this page for more details.

• 21 years and above

• Singapore citizen or Permanent Resident

• Foreigners will require a guarantor satisfying the above requirements

UOB does not display the minimum annual income needed to qualify for this loan. 

If you aren’t sure of your eligibility, it may be a good idea to contact your car dealer for clarification.

Applying directly with UOB (in-branch):

1. Visit a UOB branch: Locate your nearest UOB branch and visit in person.

2. Speak to a loan officer: Discuss your car financing needs with a loan officer and express your interest in a UOB car loan.

3. Complete the application form: The loan officer will provide you with an application form and guide you through the process.

4. Submit supporting documents: Provide the necessary documents, such as your NRIC, income statements, and proof of residence.

5. Wait for approval: UOB will review your application and contact you with their decision.

Applying directly with UOB (online):

1. Visit the UOB website: Go to the UOB website and navigate to the car loans section.

2. Check eligibility: Review the eligibility criteria and ensure you meet the requirements.

3. Fill out the online application form: Complete the online application form with your personal and financial information.

4. Upload supporting documents: Upload digital copies of your supporting documents, such as your NRIC and income statements.

5. Submit your application: Review your application and submit it electronically.

6. Wait for approval: UOB will review your application and contact you with their decision.

Need to get in touch with UOB about your car loan application? Though they do not have a personal or car loan hotline, you can contact them through

1. the UOB Contact Centre at 1800-388-2121

2. Emailing a written request to CarRedemptionRLOC@UOBgroup.com

3. Faxing a written request to 6439 2604

Remember, if you're unsure about anything, don't hesitate to reach out to UOB or your car dealer for clarification.

While the UOB Car Loan isn’t the cheapest car financing option on the market, it is still quite competitively priced. Also, it offers the same loan quantum cap and tenures as its peers, so it should serve your needs just as well as any other car loan.

The loan also covers a large selection of popular car brands, ranging from Japanese favourites like Nissan and Mazda to continental makers such as Audi and Cycle & Carriage. You can also choose to take up this loan if you’re buying a car from Carousell.

Overall, the UOB Car Loan is a solid option for financing your next vehicle purchase. It may not have the absolute lowest rates, but it offers convenience and access to a wide range of car brands and models. If you're looking for a hassle-free way to finance your new car, the UOB Car Loan merits strong consideration. 

However, in addition to car loans, there are other factors such as car insurance is something you should give careful thought to before purchasing a vehicle. This protects your car against unforeseen circumstances like accidents, theft, and damage, ensuring that your loan isn't jeopardised in case of unexpected events.

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