Canara Bank is one of the oldest banks in the country with headquarters in Bangalore, Karnataka. It was established in 1906 in Mangalore and was nationalised by the Government of India in 1969. The bank also has presence in various cities abroad such as London, Dubai, New York and Hong Kong. Canara Bank provides various loans to customers at attractive interest rates.
Owning a car is a dream come true for most and the swankier the car, the greater is the person’s status in society. Owning a car is now simple thanks to the Canara Bank Car Loans. Easy and affordable with a flexible tenure, Canara Bank offers car loans for all types of vehicles ranging from Minis to Sports Utility vehicles to Sedans at attractive interest rates. Canara Bank offers tenures of up to 84 months and does not require extensive documentation. So walk into the nearest branch of Canara Bank and walk out with quick loans to purchase your favourite set of wheels.
Car Loan Interest Rates vary based on a number of factors. These interest rates are one of the main deciding reasons behind a person’s choice for a particular car loan. Canara Bank offers attractive interest rates that varies between 9.90% to 9.95%. Apart from this, loan tenures are also flexible with the bank offering a time period of upto 84 months.The best part is that Canara Bank does not have a maximum limit per say in terms of the loan amount that is offered. These loans are provided for all individuals, either self employed or salaried customers as long as the minimum amount they earn is Rs.3 lakhs per annum.
|Rate of Interest(fixed)||
|Processing Fee||0.25% on the amount of loan between Rs. 1000 and Rs. 5000|
|Loan Amount||80%/85%/90% of the price of the car and this includes life tax, invoice value, insurance premium, registration charges and also accessories|
|Loan Tenure||Up to 84 months|
|Minimum annual income required||Rs. 3 lakhs annually|
The payment option that is chosen to pay car loans in EMI or Equated Monthly Installments which basically is the principal amount along with the interest amount that is based on the rate of interest previously determined by the bank. EMIs are paid over a tenure suitable to the applicant and with the progress in the tenure, there is a reduction in the interest amount and increase in the principal amount.
A formula for calculating the EMI on car loan is given below-
E = P*r*[(1+r)^n/((1+r)^n-1)]
Where E stands for the Monthly EMI, P is the principal amount, r refers to the interest rate applicable per month and n stands for the number of years.
For an amount of Rs. 2,00,000 at an interest rate of 9.95% with a loan tenure of 1 years, the tentative total amount that is to be paid is Rs. 2,09,208 with the interest rate being around Rs. 9,208.
For example, the following will be the amortization table for a car loan of Rs. 6,00,000 for a period of 3 years at an interest rate of 9.95% from Canara Bank.
|Year||Total Payment||Balance||Principal Amount||Interest Amount|
|2015||Rs. 57561||Rs. 551951||Rs. 48049||Rs. 9513|
|2016||Rs. 230246||Rs. 368404||Rs. 183547||Rs. 46698|
|2017||Rs. 230246||Rs. 165737||Rs. 202667||Rs. 27579|
|2018||Rs. 172684||0||Rs. 165737||Rs. 6947|
The principal amount increases with the tenure as the rate of interest decreases until the loan is paid back completely. As described in the table above, the total EMI that would be paid will amount to approximately Rs. 6,90,737 whereas the total amount of interest that is paid will be around Rs. 90,737.
There are many different determinants when it comes to deciding the car loan interest rates for Canara Bank. Based on this and the tenure chosen by the borrower, the final amount of EMI or Equated Monthly Installment that is to be paid also varies. Some of these important factors are listed below.
The interest rates provided by Canara Bank varies based on certain important factors. Leading the list is the CIBIL TransUnion Score. Credit Information Bureau India Limited or CIBIL provides, collates and keeps a record of a person’s credit card history and spends. Apart from this, if applicants have taken a loan before hand then their payment regularity and history is also noted by banks. All financial institutions prefer providing loans to those who are seen as less risky and are known to repay their debts on time. CIBIL considers the above factors and provides a score which is the CIBIL TransUnion Score. This 3-digit number is highly significant and varies between 300 to 900. Banks, lenders and financial institutions place a lot of importance onto these scores and decide whether the applicant is deemed eligible for availing loans. With higher scores, the chances of procuring the loan of your necessity is greater as those with higher scores are considered to be less risky in terms of repaying loans.
There is no maximum amount per say, a certain percentage of the total value of the car is provided and this is inclusive of life tax, invoice value, insurance premium, registration charges, and other accessories. The loan break up is as given below -
~Loan upto Rs. 10 lakhs - 90%
~Loan is between Rs. 10 lakhs and Rs. 25 lakhs - 85%
~Loan above Rs. 25 lakhs - 80%
There are various documents needed for the loan application -
~Hypothecation of the car is needed against which the loan is procured
~Personal Guarantee provided by an individual is required by the bank.
A minimum annual income of Rs. 3,00,000 is necessary.
Yes prepayment of the loan amount is allowed and Canara Bank does not charge an additional fee for the same.
Customers can apply for a car loan in the following ways -
~By directly contacting the representatives in the nearest Canara Bank branch.
~ By logging onto the Canara Bank website and applying there
~ Calling the Canara Bank Call Center
~Sending an SMS with regards to vehicle loan as part of the Product Information initiative.