Depending on the bank, different loans may be accepted for different maximum amounts. Banks typically issue loans for between 80% and 90% of the sticker price of the vehicle. Only a few banks even extend loans up to the full sticker price of the car. The percentage of financing granted also relies on the pricing, the type of automobile (standard or premium), and whether you are applying for a new or used car, in addition to these parameters.
Yes, pre-owned autos are eligible for car loans. But the interest rate on such a loan would not be the same as that on a brand-new vehicle. However, the loan would only cover the cost of the vehicle itself; you would be responsible for paying other expenses like the registration transfer, etc.
Just as the name suggests, a car loan is a loan granted to an individual interested in buying a car. Therefore a car loan is a secured loan where the car you buy acts as a collateral. Therefore, there is no additional collateral requirement for a car loan. However, you do have to get the RC (registration certificate) of the car endorsed with the bank. This endorsement is cancelled after repayment of the loan is completed.
Depending on the bank, different loans may be accepted for different maximum amounts. Banks typically issue loans for between 80% and 90% of the sticker price of the vehicle. Only a few banks even extend loans up to the full sticker price of the car. The percentage of financing granted also relies on the pricing, the type of automobile (standard or premium), and whether you are applying for a new or used car, in addition to these parameters.
A auto loan application requires self-attested supporting documents, including income (the most recent three pay stubs or acknowledged ITR), address, and identification proof documents, in addition to your PAN card. If there are any additional documentation requirements, they often vary from lender to loan.
A car loan might have a term of one year to five years. The EMI payment rises with loan term length, and the opposite is true for lengthier auto loan terms. Only a few lenders are currently offering car loans with lengthier terms of up to seven years.
Even though the majority of lenders do not state a minimum wage criterion, if the bank’s internal requirements are not met and your salary falls below a predetermined threshold, your loan application may be denied. In these situations, it may be wiser to apply for a car loan with a co-borrower to improve your chances of approval.
No. A car loan has absolutely no tax benefits whatsoever, unlike a mortgage. To avoid overspending on a nice car by taking out a huge loan amount, car loan levels should always be based on your actual needs.
The insurance and registration costs you must pay when purchasing a car are not covered by auto loans. The necessary car insurance must be obtained separately, and you are responsible for paying for any fees associated with vehicle registration since your auto loan does not cover these expenses. Few banks, nevertheless, provide customized plans to cover these expenses.
No, lenders who give personal loans to people for cars only permit the sale of the car to a new owner if the loan has been fully repaid. This is due to the fact that you must obtain a NOC from the bank before you can sell your automobile, and the document is only released once your car loan has been fully repaid.
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