COE crash course

For first-time car owners, the COE system can be overwhelming. In this article, we will give you a COE crash course that includes everything that you need to know about Singapore’s Certificate of Entitlement (COE) system.

 

What is COE?

COE also known as Certificate of represents the right to vehicle ownership in Singapore for a period of 10 years. After the 10 years, you may choose to either renew your COE for another 5 to 10 years or scrap your vehicle. The COE was implemented in November 1995 to control the number of vehicles on the road.

 

The different COE categories

The COE system has a total of five categories. Depending on the type of vehicle you have, COE may differ. It’s important you know the difference so you can get the one that matches the vehicle you’re registering.

COE crash course

Category A: Cars with engine capacity up to 1600 CC and below

Category B: Cars with engine capacity exceeding 1600 CC and above

Category C: Goods vehicles and buses

Category D: Motorcycles

Category E: “Open” category COE, can be used for all of the above

 

The process of COE bidding

There’s a limited amount of COE slots available, therefore, when demand is high, the price of the COE can be equal, or even higher, than the cost of the car. COE bidding happens twice every month, make sure to find out the closing date and time for bidding to avoid disappointment.

Bidders will submit their reserve price, which is the maximum amount they are willing to pay for their COE. The system takes the current COE price and raises it by $1, and if your bid was below the COE price, you’re eliminated. The system will continue to run until the number of bidders matches the number of available COEs.

During the bidding process, you cannot withdraw your bid. You may revise it if you’d like to increase your bid, but not if you want to decrease it.

 

How to bid?

You can either bid it yourself or get your dealer to do it.

Bid the COE yourself:

First of all, you have to be at least 18 years old, with a bank account with Citibank, OCBC, POSB/DBS, or UOB. If you’re doing it through DBS/POSB, you can bid for COE using an ATM machine. However, for other banks, the processes are different and slightly more complex, so contact your bank for more details.

When you submit bids, you have to make sure you have enough money in your account. Once the bid goes through, they take the money straight from your account, so it’s important to have the deposits ready.

If you’re bidding for Category D, the minimum is $200, while the others have a minimum of $10,000.

A step-by-step guide to self-bidding done at any DBS/POSB ATM

COE crash course

1. Insert your card and choose the option that says “Electronic COE bidding

2. Select the bank account you want your deposit and administrative fees to be deducted from

3. Select your vehicle bidding category, submit your reserve price, and wait for your application to be processed (you will be provided with an acknowledgement code)

 

Dealer bid for you:

COE crash course

There are several types of COE packages that you can purchase from dealers. These are separated into conditional and unconditional types. Be sure you are clear about the details and clauses before signing the contract!

 

1. Guaranteed COE At $XX (Conditional)

$XX is known as the agreed ceiling price. This means the dealer will only secure your COE if COE prices during the current bidding cycle fall below $XX. This is a conditional guaranteed COE. The dealer may ask you to pay the difference of the agreed price, or you may not secure your COE.

 

2. Guaranteed COE Without Top-up (Unconditional)

Guaranteed COE without top-up is the most straightforward COE package out there. Whatever price is stated on paper is the price you are going to pay, regardless of COE price fluctuations. This is the most popular option for many as they need not worry about potentially having to pay extra, or not being able to get their car at all. Although the upfront costs seem much higher than non-guaranteed COEs, rest assured that your COE is in the bag.

 

3. Guaranteed COE With COE Rebate At $XX (Conditional)

COE rebate is the amount that the dealer refunds you should the COE price fall below $XX. For example, you are offered a COE rebate at $30,000. If the COE price is $25,000, you will get back a $5,000 rebate.

However, it is rarely the case that the COE prices fluctuate drastically from the offered price level. So, make sure you get a reasonable quotation when opting for a COE rebate!

 

4. Non-Guaranteed COE

Non-Guaranteed COE, as the name implies, means there is no guarantee of the COE. While non-guaranteed COE is the cheapest option, it can be hit-or-miss, possibly leaving your car-less. You will have to pay a deposit upfront, and the dealer will help you to bid for a COE for up to three months. Should the dealer be unsuccessful in the bidding, they will refund your deposit. Therefore, you might wait for up to three months, only to realise you failed to get your car. Hence, non-guaranteed COE is the least recommended option.

 

Now, you may ask what to do after the 10 years is up. Click here to find out the options that you can take when your COE is about to expire.

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