Advisories
Advisory 15
Amendment to Maximum Amortization of New Vehicles
The following global revision to amortization periods
for vehicle financing can be inserted into Loan
Policy without any further approval required from
our office.
Amortization periods for new vehicle loans can
have a maximum amortization period based on the
following criteria:
- Purchase price including taxes is below $20,000
amortization is not to exceed five (5) years.
- Purchase price including taxes is between $20,000
and $30,000, the amortization period is not to
exceed six (6) years.
- Purchase price including taxes is above $30,000;
the amortization period is not to exceed seven
(7) years.
New vehicles are defined as follows:
1. Current model year not subject to prior sale.
2. Previous model year not subject to prior sale.
3. Current or previous model year with less than
20,000 km i.e. dealer demos or buybacks.
For those credit unions that will be adopting this
amendment, please ensure it has the approval of
your Board and amend the following section of your
Capital Utilization Policy:
1. Consumer Loans 25100 - Section 4, Amortization:
Subsection b - Vehicles.
Amended: May 2005
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