Flat rate to EIR calculator
Turn a flat interest rate into the effective interest rate (EIR) you actually pay, and see the monthly instalment and total interest on the loan.
Flat rate and EIR, plainly
Car loans and COE renewal loans in Singapore are usually quoted at a flat rate. The interest is worked out once on the full amount you borrow, for every year of the loan, and added to the loan. That total is then split into equal monthly instalments.
The catch is that you are paying the loan down every month, so the amount you actually owe keeps shrinking, while the interest stays as if you still owed all of it. The effective interest rate (EIR) is the yearly rate charged on the balance you really owe. It is the rate a reducing-balance loan would need to charge to give exactly the same monthly instalments.
| Flat rate | Tenure | EIR |
|---|---|---|
| 2.58% | 60 months | 4.88% |
| 2.58% | 84 months | 4.83% |
| 2.80% | 118 months | 5.13% |
Why lenders must show the EIR
Because the flat rate understates the real cost, lenders who finance cars on hire purchase must give you the EIR in writing before you sign, under the Hire-Purchase Act. Banks are also expected to show the EIR in their loan advertising under the Association of Banks in Singapore's code of advertising practice. Compare loans on the EIR, since it treats flat-rate and reducing-balance loans the same way.
COE renewal loans we arrange start from 2.58% flat (2.80% if a 10-year renewal is spread over more than 7 years), subject to lender approval. Read how COE renewal loans work or personal loan vs COE renewal loan.
We find the monthly rate at which your instalments, paid over the tenure, add up in present-value terms to exactly the amount borrowed, then multiply it by 12. Lenders' own figures can differ slightly with fees and how the last instalment is rounded.
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COE renewal calculator
Your monthly instalment for a COE renewal loan on this month's PQP, for Cat A or B, 5 or 10 years.Get your renewal quote
Tell us your COE category and expiry date. We'll come back with your monthly, your rebate position and the full perk list, same day. No pressure, no obligation.
in bundled perks with every renewal — free vehicle health check, engine + gearbox warranty credit & more. Rate locked for 30 days.