• How to Get a Car Loan without Income Proof?

    Any salaried or self-employed individual with a good credit score and a steady income can obtain auto financing for the sole purpose of purchasing a new or used car of most makes and models available in the market. Banks and non-banking financial companies (NBCF) offer new and used car loans to customers who meet their eligibility criteria.

    What is Car Loan Eligibility?

    Car loan eligibility varies from lender to lender. Therefore, it is important to check your car loan eligibility on the lender’s website before applying for the loan. Multiple loan rejections can have a negative effect on one’s credit score. The standard car loan eligibility criteria of a bank or NBFC are as follows:

    • Applicant must be between 21 and 65 years of age.
    • He or she must be a salaried or self-employed individual with minimum 2 years of work experience in the same field.
    • Applicant must have a minimum net annual income of Rs.3-4 lakh.
    • He or she must have a good credit score of 750 or above to get a low interest rate on the car loan.

    Car Loan Application Documents

    To apply for a car loan, download the application form from the lender’s website or get it from the nearest bank branch. Submit the duly-filled and signed car loan application form along with the following car loan document proofs:

    • Identity proof - Aadhaar card, PAN card, Driving License, Voter’s ID Card or Passport.
    • Age proof - Birth certificate or 10th/12th school certificate.
    • Address proof - Ration card or utility bills like telephone and electricity bills.
    • Income proof - The last 3-6 months’ salary slip and bank statements, Form -16, and IT Returns.

    So, what about customers/applicants who can’t provide income proof? Can they get an auto loan? Fortunately, yes. If you are unemployed or self-employed and yet finding it difficult to document your monthly/annual income, you can still get auto financing from lenders who may be willing to look at only the credit history of the applicant and not the income proof.

    Here are a few ways by which you can get a car loan without income proof:

    • In order to find a reliable lender who offers auto loans without income proof, you have to shop around, do some research online.
    • Get ready to make a large down payment on your car loan as it can bring down the cost of your car loan and also increase your chances of car loan approval.
    • If you don’t have sufficient cash to make a down payment, then you can pledge your property such as your home, fixed deposit or an old car to obtain a car loan.
    • Keep the latest bank statements and the last 2 years’ income tax returns handy to show your loan repayment capacity.
    • Prepare yourself for high-interest rate car loans as not having an income proof disqualifies you for a low interest rate. However, you do have the option to negotiate with the lender for a lower interest rate.
    • Upon car loan approval, ensure to read the fine print of the car loan agreement carefully.

    How to improve your Chances of getting a Car Loan?

    • Get a co-signer with a steady income and good credit history to apply for the car loan with you.
    • Make a large down payment on the car of your choice.
    • Put up your old car as collateral to obtain a new/used car loan.
    • Pay your credit card bills and loan EMIs on time to maintain a good credit report. Lenders will check your creditworthiness through your credit score, credit report, and credit history.
    • Check with the car dealership about alternate auto financing options but keep away from lenders involved in questionable lending practices.

    Documents Required for Car Loan Application without Income Proof

    • Self-employed applicants must submit a copy of their Business Ownership certificate and IT returns.
    • Residential proof wherein the applicant has stayed in the same residence for minimum 1-2 years.
    • Copies of the latest bank statements.
    • In the case of a co-signer, information of his/her income proof and previous loan repayment history.

    Submit the above-mentioned document proofs along with the duly-filled and signed car loan application form to the lender. Your car loan application will be verified and processed by the bank/NBFC. Upon approval, the car loan amount will be disbursed to your bank account within a matter of a few hours.


    1. What is the minimum car loan amount that I can avail?
    2. Depending on the bank, the minimum car loan amount that can be availed will vary. For example, the minimum car loan that can be availed from Axis Bank is Rs.1 lakh. The minimum car loan amount that can be availed from Kotak Mahindra Bank is Rs.75,000.

    3. What are the factors that determine the loan amount?
    4. The several factors that are considered to determine the amount of loan that can be availed are mentioned below:

      • The eligibility and your requirement
      • The repayment capacity
      • Your income
      • Your credit score
    5. What collateral/security must be provided when I avail a car loan?
    6. Usually, collateral or security need not be provided when availing a car loan. The car acts as security. However, in case you do not meet the eligibility criteria, a co-applicant may be required.

    7. What is the repayment tenure of a car loan?
    8. Depending on the bank, the repayment tenure may vary. Most banks offer a repayment tenure of up to 84 months in the case of a new car loan.

    9. Is it possible to foreclose the car loan?
    10. Yes, you can foreclose the car loan. However, a charge is levied by certain lenders in the case of foreclosure.

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