Car Loans in India
- The person must be minimum 21 years of age and above.
- Tax return documents can be proof of income to self employed, salaried people and also farmers.
- The maximum age of a person by the end of loan period should be less than 60-65 years (depending on bank and whether the person is self employed or salaried employee).
- Loans are available for citizens of India.
- Address proof along with details of whether it is owned, rented or provided by office.
- Conditions related to working experience in particular field or business.
- Part of amount provided by the bank: – This is the percentage of amount of cost of a car that a bank provides to a customer. For e.g., if the price of the car is 4 lakhs, and the bank provides 75% of the amount, then a person will have to bear the other 25%, which means he/she must bear 1 lakh of initial payment to car dealer. This 25% is also known as the down payment.
- Interest rate: – This is the rate of interest on car loan and this rate varies from bank to bank. Most of the banks in India have floating interest rates. Currently interest rate for car loans in India is between 9 to 16%.
- Period: – Every loan has a period to pay back and during this period the money will be paid back in installments with interest. This period may start from 12 months and there are banks in India those provide loans with 60 month period.
- Charges – This may or may not apply to all banks and charges will include loan processing charges, fine for delayed payment of EMI and some banks also charge a small percentage of principal amount in the beginning.
- An outing with a family after tough working hours can never be better without the modern day wagons (cars). It is hard to dream of buying a car, saving money for the purpose and sacrificing such pleasant family times.
- It is a gift to many car drivers in metropolitan cities where these wagons are sources for their living.
- These loans can be documents of certainty, i.e. a person’s discipline in repayment. Such documents will help him/her in getting other loans if required in future.
- For commercially used cars (cabs, taxis) there is space for tax exemption on car loans.
Car loans make space for a person’s wheels on road for which he will be paying a part of his income. One fine day he will be the owner of this wonder on wheels and that day he will be the legal heir of a dream well begun!