Car loan can be availed with easy documentation and with a higher loan margin, provided the minimum requirement of availing a loan is fulfilled. Some banks offer car loan at special discounts and on competitive interest rates.
Cars are a luxury as well as a basic mode of transportation for many. If you wish to buy a car to fulfill your dreams and you feel that finance is an issue, fret not. You can now drive home your dream machine with a low interest rate. Most of the leading banks in India, offer you competitive rates by providing car loan. All you need to do is make a minimum amount of down payment and then payback the car loan via EMIs that ultimately helps in reducing your loan burden. But, before you avail for a car loan, make an informed decision based on the prepayment charges, processing fees, rate of interest that your bank charges, amount of loan that you avail as well as your credit history.
In this type of car loan, your car is used as a collateral for the loan. In case you fail to repay your car loan, the bank will have the authority to repossess the car and then sell the same in order to get the money back.
In this type of car loan, there is no collateral required. Therefore, you need not provide your car as a security for obtaining a loan. You will be sanctioned a smaller quantum of loan as compared to a new car loan. However, this would mostly be at a higher interest rate.
Mentioned below is the step-by-step procedure to apply for car loan online:
Step 1 – Confirm eligibility: Use the EMI car loan calculator for deciding the amount you would like to borrow and the tenure for the same. Fill in the car loan online application form furnishing your details and then checking the offer that the lender can provide you.
Step 2 – Your offer: You will be offered an exclusive offer based on the details you provided in Step 1. It will also showcase the interest amount, tenure and loan amount
Step 3 – Duly filled in application: Fill-up an easy online car loan application form providing your professional and personal details. It will merely take only 5 minutes to fill up the application form completely.
Step 4 – Uploading the documents: Now all you need to do is upload the documents required and the car loan amount that you have requested for, will get credited to your bank account.
Mentioned below is the step-by-step procedure to apply for car loan offline:
Mentioned below are the features of a Car loan:
Mentioned below is the list of documentation that is needed for application of Car loan:
Valid identity proof:
Valid address proof:
A car loan EMI would depend on the factors mentioned below:
Formula to calculate car loan EMI is:
E = p*r (1+r)^n
Wherein E means the EMI payable
p denotes the Car loan Principal Amount
r denotes the interest rate value which is computed every month
n is the loan tenure in the form of months.
The borrowing range will vary depending on the financial institutions as well as your credit profile. But, the minimum amount for a car loan will be Rs.1 lakh and the maximum amount will depend on the income as well as your credit history. It will also vary depending on the cost of the car. There are some banks that will offer around 3 times the annual salary of the applicant for a salaried individual. It will however be around 6 times the annual income for a self-employed professional.
No, for a car loan application, you do not need a personal guarantor. It will be applicable only in cases where your credit profile does not match with the lending bank’s requirements. You may simply keep a co-applicant for such instances.
No, you do not have any option of reducing the EMI since once you sign the agreement, it simply means that you have agreed to the terms and conditions of the bank. You however can foreclose the car loan after a stipulated duration, along with a foreclosure penalty.
Your car loan eligibility will be determined based on the below factors:
No. You need to first repay the car loan amount and then sell the car. Besides, an NOC would be required from the bank or the financial institution before you plan of selling your car.
No, the bank won’t immediately take away your car. However, this will majorly hit hard on your credit profile. Eventually, any further borrowings may also be impossible or difficult. In case you delay certain EMIs, most of the banks will charge you a penalty along with a compounded interest of around 3%.
Mentioned below is the eligibility criteria to apply for Car loans in India.
• You must be an Indian citizen
• You must be at least 21 years old
• You must hold a valid PAN card
• You must be for minimum one year in case you are salaried
• You must be engaged in your business for at least a year, in case of self-employed
• You must have a source of income that is constant either by way of salary or business.
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