Paul Ho
How to make money from my car by converting my private car into a money making asset by converting your car loan.
With the advent of disruptive technology such as Uber and Grab and many others such as Lyft, Didi Kuaidi, etc., the taxi industry is being up-ended.
While the technology is not cutting edge, the idea is innovative. This created an opportunity for individuals to be able to make money from their cars.
In the past, many people often take a taxi license just so that they can drive a taxi in case they ever lose their jobs. My dad used to hold a taxi license, he was fortunate as he did not need to use it as he found a job quickly.
However for Singapore’s professionals, driving a taxi has its problems. Its expensive rental means long driving hours, professionals may not be able return to their trained profession.
Some years back, Dr. Cai Mingjie, a former A-Star principal investigator for Institute of Molecular and cell biology lost his job and became Singapore’s only taxi driver with a PhD. (Cai_mingjie, Wikipedia, https://en.wikipedia.org/wiki/Cai_Mingjie) He gained a following when he started a blog publishing his experience with driving taxi. He was lucky as he managed to return to his profession in 2010.
Many PMETs will no longer be able to re-enter the workforce in their former profession if they left for too long, and it will be a huge loss to Singapore’s workforce.
With applications such as Uber and Grab, you can use your own car to earn a living and cover your daily expenses while you continue to look for a job.
Some PMETs could also try their hand at using their cars to ferry customers.
How to convert your Passenger car to Private Hire Car by changing Car loan?
Table of Contents
However to use your own car for Private Hire, you will need to convert your car to Private hire use. That means your car will need to be registered under your company name.
Who is Eligible?
Singaporean/PR
Minimum of 1 Year of Driving experience
Above 21 years old
The full eligibility criteria can be found at LTA’s website. (Reference 1)
Steps to convert your car to make money
- Register company with ACRA with Business code 49219. You can apply under Sole proprietor or Private Limited.
- Purchase commercial car insurance for Uber and Grab.
- If there is an outstanding loan on your car. (Talk to a Loan consultant)
- Obtain a car loan under company name.
- Convert to Private Hire.
Convert your vehicle classification from P10/P11 into Z10/Z11 vehicle Log at the LTA.
- Sign up to Grab, Gojek, Ryde, Tada or other Ride Hailing App.
Or simply contact us at www.iCompareLoan.com/Contact and we will help you to handle the process.
Scenario of a Car for Own use
A new car 3 years ago = $120,000.
Loan taken = $60,000
Loan Tenure = 5 year
Interest Rate = 3%
Monthly Installment = $1,150
Assume Private Hire Car Interest rate = 3%
If you took a 5-year loan, you still have 2 years of loan left. And you are still liable for $1,150 per month of installment.
Since you do not pay rental, you have no pressure to keep driving and neglect your job search. If you spend several hours a day to drive focusing only on the peak hours, you could easily make $50 to $100 a day, and cover between $1,500 to $3,000 a month and be able to service the installment and cover some living expenses.
Property Agents and Financial Advisors Can benefit from own car
During slower market, agents and advisors could use their car to earn some extra income. Many Financial Advisors are also standing at MRT stations or shopping centers doing “surveys” to garner business.
Ferrying customers in your private hire car while tactfully striking up a respectful conversation about properties or financial planning could potentially mean extra business.
However it may not be advisable to buy a car if you cannot afford to do so in the first place and instead relied on ferrying passengers via Uber and Grab to supplement your cost of car ownership.
References
- New regulations for private hire car drivers and vehicles to better protect commuter interests, (https://www.lta.gov.sg/apps/news/page.aspx?c=2&id=59c466e2-8eff-46bc-8d60-f13bb00de4b2)
