![\"Sell](\"https:\/\/carro.co\/my\/blog\/wp-content\/uploads\/2021\/05\/pexels-negative-space-97079-300x200.jpg\")
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Banks are now more cautious when it comes to approving car loans, according to a report by Berita Harian<\/a> (Malay) as Bank Negara Malaysia raised the overnight policy rate (OPR) by 0.25% to 2.25% on 6 July 2022. OPR has an impact on a bank\u2019s interest rate for borrowings, which is bad news for new car buyers.<\/p>\n The OPR has been raised once previously this year at the same rate of 0.25% to 2% on 11 May 2022. Before that, the OPR was kept at a historic low of 1.75% from 7 July 2020 to 3 March 2022 to provide support to the economy due to the effects of Covid-19.<\/p>\n The Malaysian central bank also announced on 6 July 2022 that year-to-date, headline inflation has averaged 2.4% \u2013 the inflation rate is projected to remain within the 2.2% to 3.2% forecast range for the year.<\/p>\n Citing historical data, RHB Investment Bank analyst Jim Lim Khai Xhiang said when the OPR was at 2% between February 2009 and February 2010, the average approval rate for car loans was 60%. He added that when the OPR was increased to 3% between May 2011 and June 2014, the percentage dropped to 51%.<\/p>\n Should the OPR be increased further, Lim said hire purchase rates will likely go up as well, making it more expensive and difficult for customers seeking a car loan. \u201cAs such, we believe banks will be more careful when it comes to hire purchase approvals. This could potentially result in lower approval rates for hire purchase loans,\u201d he continued.<\/p>\n He added that rising inflation could further weaken the purchasing power of consumers, which could be made more dire should the government implement measures to reform subsidies. \u201cIn our opinion, since purchasing a car is a decision made purely out of discretion, when faced with rising cost of living and higher vehicle prices, users who are more price sensitive may be more inclined to withhold non-essential purchases,\u201d Lim said.<\/p>\n So for our readers considering buying a car<\/a> after the end of the SST exemption<\/a>, this increase in OPR might make it difficult to get a new car. Not to mention that a new car could lose up to 10%<\/a> of its value the moment it is driven off the lot. Those with tight purse strings can consider opting for a certified pre-owned car<\/a>. Not only are they more affordable, which makes SSTs and OPR increases less impactful, they also do not devalue as quickly as a new car.<\/p>\n [ays_poll id=5]<\/p>\n [ays_poll id=6]<\/p>\n","protected":false},"excerpt":{"rendered":" Banks are now more cautious when it comes to approving car loans, according to a report by Berita Harian (Malay) as Bank Negara Malaysia raised the overnight policy rate (OPR) by 0.25% to 2.25% on 6 July 2022. OPR has an impact on a bank\u2019s interest rate for borrowings, which is bad news for new …<\/p>\n","protected":false},"author":6,"featured_media":425,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[279],"tags":[211],"_links":{"self":[{"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/posts\/5086"}],"collection":[{"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/comments?post=5086"}],"version-history":[{"count":8,"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/posts\/5086\/revisions"}],"predecessor-version":[{"id":5738,"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/posts\/5086\/revisions\/5738"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/media\/425"}],"wp:attachment":[{"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/media?parent=5086"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/categories?post=5086"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging-crazy-rabbit.getcarsstaging.com\/my\/blog\/wp-json\/wp\/v2\/tags?post=5086"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"Car](\"https:\/\/carro.co\/my\/blog\/wp-content\/uploads\/2021\/08\/car-loan.jpg\")
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