Singapore Physically Disabled Exempt from Financing Restrictions on Vehicle Loans

Introduction

The Monetary Authority of Singapore (MAS) will exempt borrowers who are physically disabled or who are caregivers of the physically disabled from the financing restrictions on motor vehicle loans granted by financial institutions (FIs). MAS will also take into account the depreciation in the value of a used motor vehicle in determining the applicable loan-to-value ratio limit.

Main Digest

Exempting Physically Disabled

On 25 February 2013, MAS announced financing restrictions on motor vehicle loans granted by FIs.1 MAS has carefully considered the feedback received from different groups and has decided to exercise flexibility for the physically disabled and their caregivers, by exempting them from the credit restrictions for the purchase of one motor vehicle.

To qualify for this exemption, the motor vehicle purchased must be registered in the name of the borrower, who can be the physically disabled person or the caregiver of a physically disabled person.

The exemption will take reference from the criteria in existing assistance schemes for the physically disabled. A person will be considered a physically disabled person if he meets one of the following three criteria:

(i) Qualifies for payout under the ElderShield Scheme or the Interim Disability Assistance Program for the Elderly.

(ii) Has been issued a car park label under the Car Park Label Scheme administered by the Center for Enabled Living.

(iii) Has been certified by a physician appointed by the Ministry of Health (MOH) to be physically disabled and incapable of commuting by bus and Mass Rapid Transit. The list of MOH-appointed physicians for this purpose will be available from 15 April 2013 onwards.

A FI can apply to MAS for an exemption from the financing restrictions for a motor vehicle loan to be granted to an eligible borrower. The exemption will be for a loan for the purchase of one motor vehicle per disabled person. To support the application, the borrower will be required to provide the relevant documents.

Depreciation of Used Motor Vehicles Taken into Account

MAS will allow the open market value (OMV) of a used motor vehicle to be adjusted in accordance with its age, for the purpose of determining the appropriate loan-to-value (LTV) ratio allowable under the financing restrictions. MAS will adopt a straight-line depreciation in the value of the original OMV over 10 years (120 months) to derive an "applicable OMV" for purpose of determining the appropriate LTV ratio.4 This will address feedback received that the OMV recorded in the original vehicle registration documents does not reflect the depreciated value of a used motor vehicle.

The financing restrictions are as follows:

(i) For a motor vehicle with open market value (OMV) that does not exceed $20,000, the maximum loan-to-value (LTV) is 60% of the purchase price, including relevant taxes and the price of the Certificate of Entitlement, where applicable

(ii) For a motor vehicle with OMV of more than $20,000, the maximum LTV is 50%. In addition, the tenure of a motor vehicle loan will be capped at 5 years.

A person will be considered a caregiver of a physically disabled person if they:

(i) Have the same address on his National Registration Identity Card (NRIC) as the physically disabled person.

(ii) Is the parent, child, grandparent, grandchild, spouse or sibling of the physically disabled person.

(iii) Is a deputy appointed by the court under section 24 of the Mental Capacity Act (Cap. 177A) for the physically disabled person.

Documents required are:

(i) A written declaration that the physically disabled person and his caregivers have not been granted an exemption from the financing rules for the purchase of an existing motor vehicle.

(ii) A front and back copy of the NRIC of the disabled person.

(iii) A front and back copy of the NRIC of the caregiver of the disabled person, where the caregiver is applying for the exemption.

(iv) A copy of one of the following:

(a) A letter certifying payment of claims to the disabled person under a severe disability insurance policy taken out with an approved insurer under the ElderShield Scheme.

(b) A letter certifying payment of claims to the disabled person under IDAPE.

(c) A copy of a valid car park label issued to the disabled person under the Car Park Label Scheme administered by CEL.

(d) A certificate issued by a physician appointed by the MOH certifying that the disabled person is physically disabled and incapable of commuting by bus and Mass Rapid Transit (The list of MOH-appointed physicians for this purpose will be available from 15 April 2013 onwards).

(e) A copy of the agreement to purchase the motor vehicle and, once the vehicle is registered, the Vehicle Registration Details which can be printed from the website onemotoring.lta.gov.sg/content/onemotoring/home.html

The "applicable OMV" of a motor vehicle will be obtained by dividing its OMV over 120 months and multiplying it by the age of the motor vehicle and deducting the resulting figure from the OMV. Please refer to the FAQs for illustrations.

Attribution/Source(s):

This quality-reviewed publication was selected for publishing by the editors of Disabled World due to its significant relevance to the disability community. Originally authored by Monetary Authority of Singapore (MAS), and published on 2013/03/17 (Edit Update: 2021/05/13), the content may have been edited for style, clarity, or brevity. For further details or clarifications, Monetary Authority of Singapore (MAS) can be contacted at mas.gov.sg. NOTE: Disabled World does not provide any warranties or endorsements related to this article.

Related Publications▶ Share This Page

Page Information, Citing and Disclaimer

Disabled World is a comprehensive online resource that provides information and news related to disabilities, assistive technologies, and accessibility issues. Founded in 2004 our website covers a wide range of topics, including disability rights, healthcare, education, employment, and independent living, with the goal of supporting the disability community and their families.

Cite This Page (APA): Monetary Authority of Singapore (MAS). (2013, March 17 - Last revised: 2021, May 13). Singapore Physically Disabled Exempt from Financing Restrictions on Vehicle Loans. Disabled World. Retrieved September 11, 2024 from www.disabled-world.com/news/asia/exempt.php

Permalink: <a href="https://www.disabled-world.com/news/asia/exempt.php">Singapore Physically Disabled Exempt from Financing Restrictions on Vehicle Loans</a>: MAS announce flexibility for physically disabled and their caregivers by exempting them from credit restrictions for purchase of motor vehicles.

Disabled World provides general information only. Materials presented are never meant to substitute for qualified medical care. Any 3rd party offering or advertising does not constitute an endorsement.