2020 Toyota Yaris – What’s the minimum salary to get a loan?

Eric · Oct 24, 2020 08:00 PM

The Toyota Yaris nameplate isn’t exactly new in Malaysia, as it was first introduced here back in 2006 before getting discontinued a couple of year later.

Fast forward to 2019 and UMW Toyota Motor reintroduced the Toyota Yaris in Malaysia, this time based on the NSP151-generation Toyota Vios.

In this article, we will take a closer look and see how much you need to make each month before you can apply for a loan to purchase and maintain a Toyota Yaris.

How much do I need to make?

Starting things off is the entry-level Toyota Yaris 1.5 J (RM 69,576, on the road, without insurance), the monthly repayment is roughly RM 700 a month, given a 2.27 percent interest rate with a 9-year loan.

Following the recommended guideline that you should not be paying more than 20 percent of your monthly salary for your car’s repayment, you’ll need to bring home a net salary of at least RM 3,500 a month.

With the cost of insurance, maintenance, tyres, and other associated running costs factored in, your car-related expenses should not exceed 30 percent of your monthly salary.

However, if you want the top-of-the-line Yaris 1.5 G (RM 82,475, on the road, without insurance), you’ll need to cough out roughly RM 830 every month for the monthly repayment, meaning that you’ll need to have a minimum net salary of RM 4,200 a month.

With that said, interest rates are always changing. Given our current situation, interest rates are very low, but you will still need to check with your respective banks for the latest rates. On top of that, the prices we quoted here are only valid until 31-December 2020, as it includes the Government’s Penjana sales tax exemption incentive.

In fact, in the case of the Toyota Yaris, even the entry-level model is quite well equipped, featuring 7 airbags, stability control, LED daytime running lights, and keyless entry with push start button – a vast difference from the equally-entry level Honda Jazz.

Don't take the 9-year loan option

It doesn’t take a financial specialist to tell you this: Don’t take the 9-year loan option.

It’s a much wiser choice to opt for the shorter 5-year loan tenure instead.

Take the Toyota Yaris 1.5 J for example, by opting for the 9-year loan option, you’ll be forking out roughly RM 13,000 in interest alone, compared to RM 7,100 if you went for the shorter 5-year loan option.

The problem with 9-year loans is that the tenure is so long, the value of your car is depreciating faster than your ability to pay off the loan.

You could also end up in a situation where if for whatever reason, you are forced to sell the car or claim total loss from your insurance, you will have to top up more money before you can settle your loan because the outstanding balance is more than your car's market value.

So keep that in mind before signing for a 9-year loan.

How much to budget each month to maintain a Toyota Yaris

Toyota Yaris (estimated budget per month)
Model 1.5 J

1.5 E, 1.5 G

Tires (RM)

30/month

2-year: ~720

40/month

2-year: ~1,000

Avg service cost (RM)

70

(~850/year)

70

(~850/year)

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