Indian Bank Car Loan Interest Rates
Indian Bank offers a car loans that finance new as well as old cars at interest rates starting from 8.50% p.a. and going up to 12.9% p.a. The bank offers loans of up to Rs. 2 crores with tenures going up to 7 years.
The margin of finance offered by the bank is 15% for new vehicles and 40% for used vehicles. The processing fee charged is 0.230% of the loan amount, subject to a maximum of Rs. 10,236.
Indian Bank Car Loan
Features | New car loan/Used car loan |
Interest rate |
|
Loan ceiling | Rs.2 crore |
Loan tenure | Up to 7 years |
Processing fee | 0.23% of the loan, subject to a maximum of Rs.10,236 |
Lowest EMI per lakh | Rs.2,108 (at 9.65% p.a. interest for a 5-year tenure) |
Other Charges
Documentation charges | Nil to Rs.230 per Rs.1 lakh or part thereof |
Prepayment charges | 2.3% of the outstanding balance |
Factors Affecting Indian Bank Car Loan Interest Rate
The interest rate you are ultimately offered depends on various factors. These are:
- Credit score: A good credit score means that you make sure you pay your debts on time. As a result, banks will be willing to offer a lower rate of interest. On the other hand, a poor credit score tells banks that you may not be able to pay the instalments on time. In such cases, the bank is likely to charge you a high rate of interest and in some cases, they may even reject your car loan application.
- Income: Your income is an important aspect of your profile the bank will look into while approving the loan as well as while deciding the interest rate. If you have a high income, the bank need not worry about default payments so it will be willing to lower the rate of interest.
- Loan tenure: The loan tenure can affect the interest you pay to the bank. The interest rate offered, hence, may also differ accordingly. A long tenure could mean a lower rate of interest since the interest amount is bound to be high anyway.
- Car model: In the event that you are unable to repay the loan, banks will be left with no choice but to seize the vehicle and sell it to recover the outstanding amount. Upon reselling the car, the value depreciates significantly. Some car models depreciate much faster than others. So, while buying a car, choosing a model which depreciates slowly means that you may get a favourable rate of interest.
- Age of the car: In case of second-hand cars, the age of the car plays an important role in determining the interest rate. Buying a new car will most likely mean that the car is in a better working condition and has a longer life.
FAQs on Interest Rates for Indian Bank Car Loan
- Will Indian Bank finance a car that is 3 years old?
Yes, cars up to the age of 3 years can be financed under the car loan offered by Indian Bank.
- What is the minimum monthly income eligibility for the loan scheme?
Your minimum monthly income is required to be at least Rs.40,000 to avail Indian Bank's loan scheme.
- How is the maximum loan amount estimated?
- Salaried: If you belong to the salaried class, the maximum loan amount you can avail is equal to 20 times your gross monthly salary. Your spouse's gross monthly income can also be taken into consideration while calculating the amount. The net take home amount should be 40% of the gross salary after deduction of the car loan EMI.
- Businessmen and professionals: If you are self-employed, the maximum loan amount that will be offered is equal to your income for 20 months. The average income earned over the last 2 years will be considered as the regular income.
- Do I need a guarantor to apply for the car loan under Indian bank?
Yes, a guarantor who is a resident family member such as the spouse, son, daughter, mother, of father is required to apply for the car loan.
- What can I pledge to avail a car loan under Indian Bank?
The vehicle for which you are applying for the loan will act as security for the loan if the loan amount requested is below Rs.25 lakh. For any amount above Rs.25 lakh, properties, LIC policies, NSCs, or fixed deposit receipts can be pledged for the loan amount portion above Rs.25 lakh.
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