5 Things to Consider While Applying For Car Loan
The purchase of a car is one of the larger investments, second to the purchase of a home. The fact is that most people need cash to pay for their car, whether it is newer or used while paying cash would ideal. It is important to get ready before taking a car loan, something which generates interest when you repay over time.
There are a few important things you ought to know about car loans before you start your car buying process.
- Interest Charged on the Loan
The key factor is the interest rate for car loans. Banks now offer attractive rates of interest for car loans. Consider applying for a car loan from a lender with whom you already have an existing relationship if you are looking for a better offer.
Depending on your link to the bank, you could get a good offer. Do not take it for granted, however, that only because you have an account there you get the best deal. Look for the best deal.
- Loan Amount and Tenure
Banks are now offering as loan the amount of up to 100% of the on-road car price. You can choose the correct loan amount, based on your requirements. Needless to say, the higher amount of loans would mean higher EMIs and higher overall outflow of interest.
If you get a car on loan, usually a lender would have a repayment period of up to seven years. Just like the amount of the loan, carefully select the tenure of the loan as this will directly affect the amount of EMI.
- Your CIBIL Score
In India, loan providers have the eligibility requirements for the car loan that you must fulfil for approval of the loan. Other than your income, jobs and age, a good CIBIL score is one of the most significant requirements.
The CIBIL score is a numerical summary of your credit history in three digits. Lenders generally require a CIBIL score of at least 700 for the borrowers. Check your CIBIL score before applying to ensure you qualify for the loan.
- Processing Fee
The processing fee is the next important factor. Lenders charge a fee to review your application for the loan. Either a fixed fee or a proportion of the loan amount can be applied. Most lenders providing cheaper car loans have often a higher processing cost.
So make sure your credit provider has a reasonable processing fee that matches other leading lenders before starting the car loan approval process.
- Documents Needed
Whether you’re applying for a loan online or offline, you’ll be required to submit a few documents. Mostly you’ll need your proof of identity, proof of address, bank statements and proof of income.
When applying for the loan, you should have the paperwork ready to make sure you apply so that the loan will be approved as quickly as possible.
Buy Your Dream Car Today
These are some of the main things to consider when you take a car loan. Understanding these considerations lets you choose the right lender when applying for a car loan is simple and guarantees the application process is hassle-free. Payme India provides easy car loan with low-interest rates.
Posted by:Admin
10-02-2020
