How to Apply for Car Loan
Car Loan There was a time when buying a car was a luxury that not everyone could afford. Buying a car was a life milestone, for all those who could spend such a huge sum of money to buy their dream car. With increasing times, changing demographics, and emerging car loan lenders, for the majority of the Indian middle class, owning a car today is no longer a luxury, but a necessity than taking out a car loan.
You cannot imagine living without one. Car as it will restrict you to go for work, duties or leisure, will hinder a good social and professional life. But with new technologies and fewer resources, the cost of cars is rising, often making it extremely difficult for the average person to buy their vehicle using only their savings. Hence, considering the huge demand for financing both used and new cars, leading lenders in India offer car loans, which help you buy your car and pay off the borrowed car loan amount through car loan EMIs. enable.
Features of Car Loan
Features of Car Loans Car loans in India generally have the following features:-
- One can opt for a new or a used car loan depending on the requirement of the car. However, most people prefer car loans over new cars and not for older cars.
- The car loan option in India, for the majority, is an option that allows them to buy a car that is better than the car available in their budget since the car. Loan approval is quick.
- Car loans in India generally offer a fixed rate of interest option while making the repayment through EMI.
- It assures you a fixed repayable amount every month for the car loan, thereby facilitating better budget planning without disturbing your normal expenses.
- The bank offering the car loan mostly offers flexible repayment tenure options of 1-7 years to repay the car loan. Amount in Regular EMI
- Availing a car loan in India is often easier than any other loan and involves easy documentation along with clear instructions and guidance during the complete car loan approval and approval process.
- Car loan borrowers can avail of loans up to Rs. 1.5 Crore, mostly inclusive of 100% of the on-road price of the vehicle. Most of the banks have reasonable EMI within flexible tenure options to offer on car loans.
Car Loan for a new and used car
Car Loans are available not only for buying a new car but also for buying a used car. A used car is so obviously cheaper, that the car loan amount required will be less, and the car loan EMI will also be lower. But in most cases, an older car requires a higher maintenance cost and may have additional re-registration costs associated with it, none of which will be covered by a car loan. Hence, for a large majority of potential car buyers, approaching a bank or NBFC for new car loan options is preferred overused car loan options. Another factor is that the approval of a car loan for a new car is very quick. But buying a pre-owned car isn’t that bad of an option either. Buying a new and pre-used car through a car loan is also a good deal for you.
Car Loan Banks
Car Loan In India, being one of the fastest-growing automobile markets in the world, has many auto finance companies to tap the fast-growing market. Automobile sales account for 80% of the total passenger vehicle market and are expected to grow at a rapid pace in the coming years. An expanding middle class due to the growing demand for cars and car loans in India prompted most of the banks and NBFCs in India to provide cars. Major providers of car loans in India include Axis Bank, State Bank of India, HDFC Bank, Union Bank, ICICI Bank, and Sundaram Finance. Unique features such as overdraft facility and provision of optional SBI life insurance cover have contributed to SBI car loans.
Here we are giving the names of some top banks which give car loans:-
1. SBI Bank Car Loan:- Over the years, State Bank of India has established itself as India’s premier public sector bank and has gained a level of trust from the general public that only a few can match. Huh. SBI offers deep customer-centric car loans and other products while maintaining its customer reliance. Like others, SBI offers loan amount up to 85% of the on-road price of the proposed vehicle with very competitive interest rates, comfortable car loan repayment tenure of up to 7 years, and 0% pre-payment or foreclosure charges.
2. Axis Bank Car Loan:- Simple car loan application process, customer friendly terms and conditions, strong customer support initiatives and adherence to modern methods of personal banking differentiate Axis Bank and position it as a leading private sector bank in the market. places as. It offers up to 85% of the on-road price of the vehicle offered through its car loan, and in the case of select car models, this number can reach up to 95% of the vehicle’s on-road price.
3. Union Bank Car Loan :- Union Bank is recognized as one of the leading car loan offerings in India. It provides financing for the purchase of both used and new cars for up to 3 years. The initial terms and conditions make Union Bank Car Loan one of the most attainable car loan products in the market with the advantage of zero prepayment penalty and processing fee clause making it pocket friendly thereby helping you save costs. .
4. Sundaram Finance Car loan Sundaram Finance Group (SFG), having 566 branches across India, is a leading Non-Banking Finance Company (NBFC) in India, offering a diverse portfolio of products and services. Sundaram Finance has gained strength in its segment by serving a very large client base. They offer exclusive packages and customized products for women and senior citizens and offer additional benefits like flexible and customizable insurance options for all your cars. Another plan called Money on Wheels is a pre-approved car loan on your existing car at attractive interest rates, which are much lower as compared to other personal loans.
5. IndusInd Bank Car Loan :- IndusInd as part of Hinduja Group Group has carved a niche for itself in the Indian banking industry. IndusInd Bank offers quick and comprehensive loan options when it comes to buying a used car which makes it an active player in the field of car finance. Not only to offer financial services, the bank is also known for using technology to provide innovative services like video branch, cash on mobile etc.
Required eligibility and criteria for car loan
Common requirements for an individual to be eligible for car loan approval, irrespective of the financial institution or loan amount, include:-
- Applicants must be salaried, self-employed, business owners or professionals,
- Applicants must be of Indian nationality residing in or outside India,
- The age of the applicant should be at least 21 years and not more than 65 years,
- Must meet minimum repayment capacity or minimum wage requirements.
- One year in current job (salaried) or two years in same occupation (self-employed or professional)
Documents Required for Car Loan
Following is a list of commonly asked documents for the documents required while applying for a car loan:
1. Income proof documents for Self-employed persons :-
- The duly signed and filled application form is available on the website or at the bank’s outlet.
- Passport size 4-6 photographs.
- An identity proof which can be one of these documents- Passport, PAN card, Driving license, Voter ID, Aadhar card or Employee ID card in case of government employees.
- Address proof such as bank statement, rent agreement, voter ID card, ration card, passport, driving license, telephone bill, electricity or water bill, credit card bill or property tax document.
- Age proof which can be Voter ID, Secondary School Leaving Certificate (Class 10), Birth Certificate, Passport, Aadhar Card, Pension Payment Order or LIC Policy Receipt.
2. Income proof documents in case of salaried individuals :-
- Latest 3 months salary slip.
- Form 16 with proper computation of income.
- Salary account bank statement for six months.
- Latest Approved IT Returns.
- Business stability and ownership proof.
- Computation of income of last two years.
- profit and loss statement
- Balance sheet certified by CA.
- Latest six months bank statement.
- Copies of Sales Approved IT Returns for the last two years.
PAN card for the lender to check and verify whether you are trustworthy enough to make regular payments by your credit record history.
Documents providing vehicle information which may include sales receipts from the seller.
In order to establish that, all applicable laws and protocols with respect to the vehicle purchased are complied with, the applicant must also submit the vehicle’s motor insurance and copies of your driving license.
Interest Rate for Car Loan
Car Loan interest rates are linked to the base rate set by RBI instructions, the rate varies slightly from bank to bank. Additional factors that affect the interest rate on a car loan include the loan amount, loan term, your credit history and your reputation with the bank. Currently car loans are available at interest rates ranging from 10% – 15%, but there are some banks that offer it as low as 9.55%. Every bank has a different rate of interest. You can take a car loan from the bank whose interest rate is low for you.
How to Apply for Car Loan
- First of all, visit the site of the bank from which you want to take a loan.
- After that select ‘Car Loan’ from the many options that appear on the home page.
- Fill the ‘Eligibility Criteria’ form selecting the best options.
- Once the form is completely filled, click on ‘view offer’ at the end of the form.
- You will reach a page listing the banks and their offers related to the loan you need.
- Browse through the loans and click on ‘Apply’ on the right side.
- Then fill your details in the form spread in front of you to proceed with the loan application.
- This form will be sent to the bank and the concerned bank will contact you and speed up the process, helping you apply for a car loan with ease.