If you really think about it, it's easier getting a loan for a car than a loan for bus fare!

    Oriental Bank of Commerce (OBC) Car Loan Interest Rates

    Oriental Bank of Commerce (OBC) Car Loan Floating Interest Rates

    Particular Charges
    For male borrowers 9.25% p.a.
    For female borrowers 9.15% p.a.
    Concession in rate of interest (for select categories) 0.25%
    Processing Fee 0.50% of the loan amount subject to Rs.500 minimum and Rs.7000 maximum + ST
    Loan Tenure Up to 120 months
    Income criteria A gross amount of Rs. 30,000 per month
    Prepayment Charge Nil
    Documentation Charge Nil
    Upfront fee Nil
    Margin 15% on on-road cost

    Oriental Bank of Commerce is a public sector bank that has its headquarters in Gurgaon, Haryana and was founded in 1943. Among its various offerings, Oriental Bank of Commerce provides easy-to-avail car loans for all those looking to own their dream vehicle. Loans are available on a variety of cars that are required for non-commercial use. Customers can procure loans without the hassle of excess documentation and at competitive interest prices for a flexible loan repayment tenure. Availing car loans has never been easier thanks to Oriental Bank of Commerce.

    Oriental Bank Car Loan Interest Rates
    Oriental Bank Car Loan Interest Rates

    Oriental Bank of Commerce Car Loan Interest Rates

    Interest rates charged on any particular loan varies and this rate is an important factor considered by prospective customers. Oriental Bank of Commerce offers floating interest rates and concessions on interest rates for loyal customers, group of employees, and existing home loan borrowers.

    How to Calculate Interest Rate on the Oriental Bank of Commerce Car Loan Interest Rates?

    EMI or Equated Monthly Installments is the method through which loans are repaid to the bank and in essence, this is the principal amount and the interest amount based on the rate of interest previously determined by Oriental Bank of Commerce. These EMIs are paid over a period of time chosen by customers in accordance with the bank and usually vary from 12-84 months. Customers, with the help of a simple formula, can now calculate the EMI that they will have to pay each month to the bank. It is to be noted that with the progress in the tenure, there is a decrease in the interest amount and increase in the principal amount.

    The formula used for calculating EMIs are as given below -

    E = P*r*[(1+r)^n/((1+r)^n-1)]

    Where E is 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 example, the following will be the amortization table for a car loan of Rs.12 lakh for a period of 3 years at an assumed interest rate of 9.10% from Oriental Bank of Commerce.

    Year Principal Paid (A) (Rs.) Interest Paid (B) (Rs.) Total Payment (A+B) (Rs.) Outstanding Loan Balance (Rs.)
    Year Principal Paid (A) (Rs.) Interest Paid (B) (Rs.) Total Payment (A+B) (Rs.) Outstanding Loan Balance (Rs.)
    2019 3,32,695 87,677 4,20,372 8,67,305
    2020 3,95,903 62,682 4,58,585 4,71,401
    2021 4,33,472 25,114 4,58,586 37,928
    2022 37,928 288 38,216 0

    Factors affecting Oriental Bank of Commerce Car Loan Interest Rates

    There are many different factors that have an impact on the car loan interest rates decided by Oriental Bank of Commerce. Some of the most important factors are given below -

    • Income - The minimum income required is a criterion set by most banks in order to decide the suitability of a customer availing a loan. The minimum amount is decided based on the occupation of the customer such as if he/she is salaried or self-employed or if he/she is a non-resident Indian, etc. Based on the income, collaterals that are required also vary. Sometimes having a co-applicant may also help.
    • Loan repayment tenure - Generally it is believed that longer tenures are suitable and preferred as the EMI that is paid each month will be lesser, however customers may end up paying a lot more interest. Apart from this, longer tenures also signify more risk to the bank as there is a higher chance of loan payments getting hampered or interrupted due to unforeseen circumstances like accidents and such or even inflation. Therefore, higher rates of interest may be charged on longer tenures, which is why a shorter tenure is advisable.
    • CIBIL Scores - Credit Scores and the resultant CIBIL score are taken into account by banks. These credit scores are maintained by the Credit Information Bureau of India Limited. Having good credit scores is akin to a reassurance to banks that the customer can repay loans without much hassle. Therefore, maintaining a good CIBIL score is important. In addition to this, having good CIBIL scores may also result in the bank providing better interest rates.
    • A prior relationship with the bank is another benefit that can be availed by borrowers as the process of procuring loans becomes a lot simpler and is more convenient. Customers who already have a working relationship with the bank can also avail certain concessions on their interest rates.
    • Down Payment - Down payment is mandated by certain banks while availing a loan. The higher the amount provided as down payment, lower is the interest rate charged on the loan as the amount to be repaid to the bank is less. A higher down payment is seen as less risky by the bank while providing loans and is therefore advised.
    • Car model - Cars are depreciating assets, as in their value decreases over time and this is seen more clearly in some models as compared to others. Also, certain cars come with additional features that make them all the more expensive. These factors may result in the bank charging additional interest rates as the risk for the bank increases. Banks need assurance that the customer will repay the availed loan with the applicable interest rate hence the type of car they are financing plays a role in the interest rate that is charged.

    How CIBIL Scores affect Oriental Bank of Commerce Car Loan Interest Rates?

    The interest rates provided by Oriental Bank of Commerce vary based on certain important determinants. The top of the list is the CIBIL TransUnion Score. Credit Information Bureau India Limited or CIBIL keeps track of a person’s spends, repayment, and general information regarding this. Additionally, if loans have been previously availed, then the payment history and regularity of EMI payments are also taken into consideration. Those who present a lower risk in terms of loan repayment are given higher priority by banks while providing loans. CIBIL considers the above factors and provides a score which is the CIBIL TransUnion Score. This 3-digit number plays a very important role and varies between 300 and 900. Banks, lenders, and financial institutions rely on this score and deem the customer eligible or not for procuring car loans. With higher scores, the chances of availing the loan of your choice with a good interest rate are greater as those with higher scores are considered to be less risky when it comes to repayment.

    Frequently Asked Questions (FAQs) about Oriental Bank of Commerce Car Loan Interest Rates

    • What collateral or security should the applicant provide?

    Based on the vehicle that is to be purchased the collateral required varies. Apart from this, the income of the applicant also determines the collateral.

    For the purchase of four wheelers, in case the applicant’s gross monthly income is below Rs. 30,000 then he/she should provide one personal guarantee that is acceptable to the bank.

    Hypothecation of the new car that has been purchased out of the bank finance with the hypothecation charge registered in the RTO book.

    • Who all are eligible to procure a car loan from Oriental Bank of Commerce and are co-applicants allowed?

    People eligible to receive a car loan from the Oriental Bank of Commerce are salaried individuals with at least a year of service, professionals including doctors, self-employed people, Non-resident Indians and agriculturalists. Co-applicants for the car loan can be any of the family members such as father, mother, spouse, brother, son, son-in-law and daughter-in-law and daughter (married and unmarried) of the applicant.

    • What are the components of finance?

    One-time Road tax, showroom price, and registration charges along with the insurance cost for the first year.

    • What is the maximum loan amount admissible?
    In case it is below Rs.50,000 per month 40% In case it is above Rs. 50000 per month 30%
    • If the applicant owns a business, then cash generations are required.
    • Apart from this, income of family members of the applicant can also be taken into consideration, so as to meet the minimum income requirements.

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