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  • Top 10 Banks for Car Loan in India 2019

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  • Many financial institutions and banks in the country offer car loans for those who wish to own a car but do not wish to exhaust their savings or are unable to afford buying the car by paying fully in cash. Since there are many lenders who offer car loans in India, you may tend to get confused about which lender to pick. Hence, to make it easier for you to decide, we have listed out the top lenders in the country who offer car loans.

    Top Lenders in India Offering Car Loans

    Name of the Lender Interest Rate (p.a.) Processing Fee
    State Bank of India 9.15% to 9.85% Rs.1,000 plus GST to Rs.1,500 plus GST
    Bank of Baroda 9.10% onwards 0.50% of total car loan amount, subject to maximum of Rs.10,000
    Union Bank of India 8.65% No processing fees
    HDFC Bank 9.65% to 10.60% 0.40% of total loan amount subject to minimum amount of Rs.3,000 and max of Rs.10,000
    Federal Bank 9.15% Rs.1,500 to Rs.2,500
    Axis Bank 9.05% onwards Rs.3,500 to Rs.5,500
    Canara Bank 8.90% to 9.45% 0.25% of total loan amount subject to minimum of Rs.1,000 and maximum amount of Rs.5,000
    IDBI Bank Car Loan 9.30% to 9.90% Rs.1,000 plus taxes
    Punjab National Bank 9.00% Rs.1,000 to Rs.1,500
    Syndicate Bank 9.15% to 9.40% Rs.125 to Rs.200

    1. State Bank of India Car Loan
    2. Features:

      • The interest rates on SBI Bank Car Loan are one of the lowest in the market and are calculated on daily reducing balance.
      • SBI offers car loans under 4 categories namely, SBI New Car Loan Scheme, SBI Loyalty Car Loan Scheme, SBI Assured Car Loan Scheme, and SBI Car Loan Lite Scheme.
      • Financing of up to 90% of the car’s on-road price can be availed which will include registration, cost of accessories, insurance, extended warranty, annual maintenance contract, etc.
      • An optional life insurance cover is offered by SBI to its borrowers.
      Name of the Car Loan Designed For Interest Rate (p.a.) Minimum Income Criteria Maximum Loan Amount
      SBI New Car Loan Scheme All borrowers 9.15% to 9.85% Rs.2.5 lakh 48 times the net monthly income
      SBI Loyalty Car Loan Scheme SBI Home Loan borrowers
      • Women – 9.70%
      • Men – 9.75%
      Rs.2 lakh Will depend on various factors
      SBI Assured Car Loan Scheme - 9.15% to 9.85% Income declared by the applicant No cap on the maximum loan amount
      SBI Car Loan Lite Scheme People engaged in economic activity but have no income proof
      • For CIBIL scores above or equal to 750 – 11.45%
      • For CIBIL scores from 650 to 749 – 12.45%
      Rs.2.5 lakh Rs.4 lakh

    3. Bank of Baroda Car Loan
    4. Features:

      • Offers the benefit of lower interest rates to individuals with a high credit score
      • The interest rates on Bank of Baroda car loan are computed on daily reducing balance
      • The bank does not charge any penalty on pre-closure of car loans
      • The minimum credit score required to avail a car loan from Bank of Baroda is 725
      Maximum Loan Amount Repayment Period Age of the applicant Margin
      Rs.1 crore 84 months Between 21 years and 70 years 10% on the car’s on-road price

    5. Union Bank of India Car Loan
    6. Features:

      • Applicants with good credit scores can enjoy discounts on car loan processing fees.
      • Married applicants will have to be guaranteed by the spouse while unmarried applicants will have to provide a third-party guarantor.
      • The Union Bank of India car loan borrower should meet the margin requirements of 15% of the vehicle’s on-road price.
      • Existing customers of the banks will enjoy additional benefits from Union Bank of India
      Maximum Loan Amount Repayment Tenure Prepayment Penalty Age Criteria Guarantor
      Rs.125 lakh 7 years
      • No penalty will be charged if the borrower adjusts the loan against own verifiable legitimate sources
      • 2% on the average balance of the previous 1 year subject to conditions
      • Minimum – 18 years
      • Maximum – 70 years
      Mandatory

    7. HDFC Bank Car Loan
    8. Features:

      • The car loans offered by HDFC Bank are custom-fit to meet the requirements of the borrowers.
      • Comes with flexible repayment options in the form of step-up EMI and balloon EMI.
      • A comprehensive insurance cover known as Suraksha Kawach is offered with the car loans from HDFC Bank.
      • Existing car loan borrowers can avail top-up loans without any documentation.
      Documentation Charges Foreclosure Charges Part-payment Charges Overdue EMI Interest Collateral Charges
      Rs.630 per instance 6%, 5%, and 3% of principal outstanding for foreclosure within 1 year from 7th EMI, between 13 and 24 months from 1st EMI, and after 24 months from 1st EMI respectively 5% and 3% of principal outstanding on the part payment amount done from 13 to 24 months from 1st EMI and after 24 months from 1st EMI respectively 2% per month Rs.475 per instance

    9. Federal Bank Car Loan
    10. Features:

      • No penalty charged for foreclosure of the car loan.
      • Personal accident insurance is offered free of cost with the Federal Bank car loan up to Rs.10 lakh.
      • Up to 100% of the vehicle’s ex-showroom price can be availed.
      • Borrowers can get a reimbursement within 1 month from the day the vehicle was purchased.
      Minimum Income of the Applicant Repayment Tenure Preclosure Charges Processing Fee Maximum Loan Amount
      Rs.20,000 per month after the deduction of all EMI commitments 84 months Nil Rs.1,500 to Rs.2,500 100% of the car’s ex-showroom price

    11. Axis Bank Car Loan
    12. Features:

      • Priority banking customers of Axis Bank can enjoy special benefits on car loans.
      • Repayment of the Axis bank car loan can be made in 3 ways namely, electronic clearing service (ECS), standing instruction (SI), and post-dated cheques.
      • The minimum amount that a borrower can avail as a car loan is Rs.1 lakh.
      • Borrowers can earn Axis eDGE reward points on availing the car loan.
      Maximum Loan Amount Repayment Tenure Documentation Charges Foreclosure Charges Part payment Charges
      100% of car’s on-road price Up to 8 years Rs.500 per case 5% of the principal outstanding 5% of the part payment amount

    13. Canara Bank Car Loan
    14. Features:

      • Known as Canara Vehicle, the car loan offered has no limit on the loan amount.
      • Up to 90% of the total value of the car can be availed as a car loan from Canara Bank and this is inclusive of registration charges, invoice value, insurance premium, life tax, etc.
      • To buy a new car costing up to Rs.10 lakh, above Rs.10 lakh and up to Rs.25 lakh, and above Rs.25 lakh, you will need to pay 10%, 15%, and 20% of the loan amount respectively.
      • The Canara Bank car loan can be availed by all individuals, professionals, firms, etc., except for Hindu Undivided Families (HUFs).
      Minimum Income Criteria Repayment Tenure Prepayment Charges Maximum Loan Amount Documentation Charges
      • Salaried applicants – gross salary of Rs.3 lakh p.a.
      • Self-employed applicants – gross income of Rs.3 lakh p.a. and gross average yearly income of at least Rs.2.50 lakh
      Up to 84 months Nil No cap on the maximum loan amount -

    15. IDBI Bank Car Loan
    16. Features:

      • The IDBI Bank car loan can be used to buy cars in any segment – hatchbacks, sedans, sports utility vehicles (SUVs), etc.
      • The bank has tie-ups with car dealers and manufacturers to ensure the best deals to borrowers.
      • The EMIs can be paid through standing instructions or ECS.
      • You can expect a higher loan sanction for purchasing your dream car.
      Age Criteria Minimum Income Documentation Charges Foreclosure Charges Repayment Tenure
      • Minimum age – 18 years
      • Maximum age – 70 years
      Rs.2.4 lakh p.a. As per actual cost 1% of balance outstanding after 6 months of loan disbursement 7 years

    17. Punjab National Bank Car Loan
    18. Features:

      • The bank has partnered with leading car manufacturers such as Tata Motors, Honda Cars India, Maruti Suzuki India, Mahindra & Mahindra, and Force Motors Ltd., to offer best deals on car loans.
      • The bank offers both fixed and floating interest rates on the car loan.
      • A collateral security or third-party guarantee must be provided to avail a Punjab National Bank car loan but based on an individual’s merit, this condition can be waived off.
      • For the benefit of government employees, Punjab National Bank offers car loan under the name ‘PNB Pride Car Loan’.
      Maximum Loan Amount Margin Repayment Tenure Documentation Charges Prepayment Charges
      Rs.100 lakh or 25 times of pension income/net monthly salary, whichever is lower 15% of the vehicle’s on-road price 84 months
      • Up to Rs.6 lakh – Rs.1,000
      • Above Rs.6 lakh – Rs.1,500
      • Floating Rate – Nil
      • Fixed rate – 2% on the outstanding prepaid amount

    19. Syndicate Bank Car Loan?
    20. Features:

      • A third-party guarantee is not required to avail the Syndicate Bank car loan, also known as ‘SyndVahan’.
      • All individuals, partnership firms, proprietorships, trusts, societies, directors/employees of the corporates, other legal entities except for HUFs, are eligible to avail the loan.
      • An amount of Rs.10,000 is also offered to car loan borrowers for the purchase of car accessories.
      • Borrowers whose salary is credited to their Syndicate Bank accounts will enjoy discounts on car loan interest rates.
      Maximum Loan Amount Minimum Income Repayment Tenure Documentation Charges Inspection Charges
      85% of the vehicle’s on-road price or 3 times the gross annual income, whichever is less Rs.2 lakh p.a. 84 months
      • Up to Rs.2 lakh – Nil
      • Above Rs.2 lakh – Rs.100 per lakh (maximum-Rs.1,250)
      • Up to Rs.1 lakh – Rs.250 per inspection
      • Above Rs.1 lakh – Rs.500 per inspection

    The above list should have given you a fair idea about the benefits and features offered by various lenders on their car loans. You can now go ahead and make an informed decision on which lender you should pick to fund the purchase of your dream car.

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