|Name of Bank||Interest Rates on Car Loan (p.a.)||Financing|
|State Bank of India (SBI) Car Loan||9.30% to 9.80%||Up to 90% of the on-road price of the vehicle|
|HDFC Car Loan||9.75% to 10.60% rack interest rate||Up to Rs.3 crore or up to 100% of the on-road price of the vehicle|
|ICICI Car Loan||12.85% up to 35 months 9.30% for 36 to 84 months||Up to 100% of the on-road price of the vehicle|
|Union Bank of India Car Loan||One-year MCLR – 8.60% Base Rate – 9.00%||Up to Rs.125 lakh for a new vehicle|
|Axis Bank Car Loan||9.25% to 11.50%||Minimum Rs.1 lakh, up to 100% of the on-road price of the vehicle|
|Federal Bank Car Loan||9.20% for new vehicles||Up to 100% of the ex-showroom price of the vehicle|
|IndusInd Bank Car Loan||10.65%||Up to 85% of the ex-showroom price of the vehicle|
|Punjab National Bank Car Loan||8.75%||Up to Rs.100 lakh or 25 times of the net monthly salary or pension or income (lower of the two).|
|Oriental Bank of Commerce (OBC) Car Loan||For male borrowers: 1-year MCLR + 0.50% For female borrowers: 1-year MCLR + 0.40%||Up to Rs.20 lakh (100 equated monthly instalments) Up to Rs.25 lakh (120 equated monthly instalments)|
|Jammu and Kashmir Bank Car Loan||Fixed rate – 11.25% p.a. Floating rate – B.R + 1.00% p.a. (both with monthly rests)||Net monthly salary of the applicant for 36 months or 3 times the net annual income.|
|Andhra Bank Car Loan||1-year MCLR + 0.70%||Rs.25 lakh to Rs.50 lakh on the basis of the dealings with the bank.|
|Bank of Maharashtra Car Loan||Fixed rate – 8.95%||Up to 2 times the average annual income of the applicant|
|Bank of India Car Loan||1-year MCLR + 0.50% = 9.10%||Up to Rs.125 lakh|
|Central Bank of India Car Loan||Floating rate – MCLR + 0.40% Fixed rate – MCLR + 0.40%||Up to Rs.75 lakh|
|United Bank of India Car Loan||For male borrowers: MCLR-Y + 0.30% = 9.15% p.a. For female borrowers: MCLR-Y + 0.25% = 9.10% p.a.||Up to Rs.40 lakh|
|Dena Bank Car Loan||Base rate – 9.60% BPLR – 15.10%||Up to Rs.200 lakh|
|Syndicate Bank Car Loan||1-year MCLR + 0.75%||Up to 85% of the on-road price of the vehicle + Rs.10,000 for accessories, or 3 times of the gross annual income of the applicant (lower of the two)|
|IDBI Bank Car Loan||9.30% to 9.90%||-|
|Bank of Baroda Car Loan||1-year MCLR + strategic premium + 0.25% to 1-year MCLR + strategic premium + 2.00% (on the basis of risk factor associated)||Up to 90% of the on-road price of the vehicle to an extent of Rs.100 lakh|
|Canara Bank Car Loan||For women borrowers – 1-year MCLR + 0.30% to 0.85% = 9.00% to 9.55% For other borrowers – 1-year MCLR + 0.35% to 0.95% = 9.05% to 9.65%||Up to 90%/85%/80% of the total value which includes of invoice value, registration charges, life tax, insurance premium, and other accessories.|
|Car Loan Interest Rate Particulars||Details|
|Interest rate||8.25% - 15% p.a.|
|Processing fee||0% to 2% of car loan amount + Applicable Service Tax (One-time fee)|
|Type of interest rate||Fixed or floating|
|Loan amount||Rs.25,000 to Rs.2 crore|
|Loan tenure||1 to 7 years|
|Preferred credit score||750 or above|
|Pre-closure fee||Nil to 6% of principal of the outstanding car loan amount|
Today, a car is no longer considered to be luxury, but a necessity. However, shopping for a car can be quite a task. Choosing the car that you like, the colour you would like to get, the features you are looking for in your car, the budget, etc. are some of the many things you generally consider while shortlisting the right vehicle for yourself. However, the most important task is the financing for the car.
This is where car loans and car loan rates enter the scene. You can easily apply for a four-wheeler loan and purchase your dream car now. The car loan rates will help you ascertain the interest amount that you would be paying for your car, in addition to the principal amount. You can get a car loan for a desired tenure and pay off the debt in monthly EMIs. The growing number of car loan lenders has made it easier to apply and get car loans, and the best part is the fact that you can avail a new car loan or a used car loan, as per your preference.
1) Easy instalments: While you are using the car of your dream, you can also pay off the amount through easy instalments.
2) Collateral: When you apply for a car loan, you will not be required to provide separate collateral against the loan amount. In case of a car loan, the car you get using the loan acts as collateral.
3) Foreclosure: Most car loan lenders offer the provision of foreclosing a loan. In case, you can afford to pay off the loan before the end of the loan tenure, you might want to write off the debt straightaway. In such cases, lenders offer foreclosure. However, you might or might not be charged for foreclosure. The foreclosure charges differ from lender to lender. Even if a foreclosure charge is applicable, in most cases the charges are really low.
|Down Payment||The financing provided in a car loan differs from lender to lender. Down payment is the initial amount that you pay at the time of getting the car. The higher the down payment, the lower will be the burden of loan. This will lead to lower EMIs. Thus, it is recommended to make a down payment of as much as you can afford to spare.|
|Car Loan Processing Fees||The usual processing fees for a car loan can range between Rs.250 and Rs.20,000. The processing fees differ from lender to lender. You should check and compare the rates before you opt for the loan.|
|Foreclosure and prepayment||After getting a car loan, if you feel that you will be able to close off the debt earlier, you might want to write off the debt partially or fully. In case of partial repayment, it is referred to as prepayment. If the entire loan amount is paid off, it is called foreclosure. In such cases, your lender might charge a fee for the same. The charges usually range from nil to 5%. In some cases, the lenders do not even allow prepayment or foreclosure. Thus, it is advisable to check and compare the rates at which the lender charges the fees.|
|Insurance Premium||As per the Motor Vehicles Act, it is compulsory to have a motor insurance policy for your car. The insurance coverage and the premium amount provided by different insurance providers vary. It is recommended that you compare the different insurance terms and conditions before you choose an insurance policy for your car.|
There are a number of schemes from which an individual can choose the terms for his or her loan repayment. These schemes can be summed up as follows:
1) Advance EMI scheme: In this scheme, the EMI is paid on an advance basis. That is, the EMI is charged at the beginning of a month.
2) Arrear EMI scheme: In this scheme, the EMI is paid on an arrear basis. This is the usual method of paying off EMIs. In this case, the EMI is paid at the end of a month.
3) Flat rate of interest scheme: In this case, the EMI consists of the amount which is paid as interest on the total amount of principal till the end of the tenure of the loan.
4) Zero interest EMI scheme: The zero interest EMI scheme is also known as the 0% finance scheme or the no-cost EMI scheme. However, when it comes to car loans, it is just a fancy marketing term. If a scheme claims to provide zero interest on the car loan, it is highly likely on the part of the car dealership to just flare up the price of the car up to the amount of interest.
5) Reducing balance scheme: Under the reducing balance method, the interest paid by you will be calculated on the amount outstanding every month. The balance amount of the principal, in this case, keeps reducing with the payment of each EMI.
When you are interested in applying for a car loan from any bank or NBFC, you will need to meet certain eligibility criteria to get your loan application approved. Each bank and each NBFC will have different eligibility criteria for its car loan borrowers. The eligibility conditions that are common across all lenders include age, income, insurance proof, identity proof, car model, etc. Apart from individuals, a business firm or organisation can also apply for a car loan.
|Minimum age||18 to 21 years|
|Maximum age||70 to 75 years|
|Employment status||Salaried or self-employed|
|Minimum income||Rs.10,000 per month|
|Type of car||Old or new. The loan interest rate will be determined according to the type of car.|
|Number of years of work experience for loan applicant||Total of 3 years of experience in company or business and at least 2 years in present profession or business or position|
|Value of car||This has an impact on the loan amount that will be approved and the loan interest rate.|
|Area of residence||Urban or semi-urban or rural. Your car loan interest rate will be fixed accordingly.|
|Car model||Only approved car models|
|Income eligibility proof||Latest salary slips, Form 16, or latest income returns|
|Insurance proof||Your bank or NBFC may ask you to show your car insurance policy before approving your car loan.|
|Credit report and credit score||Your lender will review your credit report thoroughly to understand your previous credit behaviour. If you have a good credit score, you will be eligible for your car loan.|
|Co-applicant||If your credit score is very low, your lender may require you to have a reliable co-applicant to approve your car loan application.|
|Identity proof||In order to prevent fraud or theft, you will need to furnish accurate proof of identity while applying for a car loan.|
Yes, an applicant can negotiate with the bank for a lower interest rate on their car loan. Generally, the interest rates are not fixed. They vary for different customers. Thus, if the applicant holds a good credit history, he or she can ask the lender for lower interest rates. A lender will offer lower interest rates for the loan if it considers the applicant to be worthy.
Generally, there are 2 different types of interest rates that are offered to the customers by the lenders. They are – floating interest rates and fixed interest rates. The applicant has to make a choice and choose one of the options as per their requirement.
The loan amount that an applicant will be eligible for will be based on a number of factors such as his or her income, age, credit history, and so on. Usually, banks offer finance of up to 85% to 100% of the value of the vehicle. However, the financing will be based on the factors mentioned above. Other factors that are taken into consideration are the credit score of the applicant, the type of vehicle that he or she is purchasing, the actual cost of the vehicle, etc.
The documents that an applicant will be required to provide at the time of applying for a car loan are as follows:
After the submission of documents to the lender, the bank usually takes 3 to 7 working days to process a car loan.
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