Syndicate Bank offers car loans at an attractively low interest rate of 10.35% and it is calculated based on monthly reducing balance. The interest rate is linked to the base rate which fluctuates periodically. Hence, the total interest payable is Base Rate plus 0.65%. Repayment tenure is very flexible as the borrower can choose to repay the car loan amount in up to 84 EMIs. For new cars, a customer can repay up to 7 years and for used cars the repayment tenure is 5 years.
|Interest Rate||10.35% (Base Rate + 0.65%)|
|Maximum Loan Amount||Maximum loan amount offered to a borrower is either:
|Minimum & Maximum Car Loan Tenure||Minimum Tenure - 12 months Maximum Tenure - 84 Months (7 years)|
|Documentation Charges||For a loan amount below Rs. 2,00,000 - Nil For loan amount above Rs. 2,00,000 the documentation charge is Rs. 100 per lakh with a maximum amount capped at Rs. 1250.|
|EMI per Lakh||Rs. 1678/-* (for a 7 year loan tenure at 10.35% interest)|
* Estimated Value
Syndicate Bank was initially known as “Canara Industrial and Banking Syndicate Limited” and was established in 1925 in Udupi, Karnataka. It was renamed as Syndicate Bank in 1964. The car loan scheme offered by Syndicate Bank is called “SyndVahan” which is available to borrowers for the purchase of used as well as new vehicles. Borrowers can avail up to 95% of the ex-showroom value of the car. Some highlights of this auto loan scheme are: high loan quantum, low income eligibility constraints, flexible repayment tenure, etc.
Calculating Syndicate Bank Car Loan Interest is based on a simple formula which is:
EMI (E) = [P x r x (1+r)^n]/[(1+r)^n-1]
Here, the values connoted “E”, “P”, “R” and “n” stands for is EMI, the principal amount of the loan, the applicable rate of interest and the loan tenure, respectively. “R” is the interest rate that is applicable on the loan amount, per month. Therefore, in order to get the monthly rate of interest, the formula used on the annual interest rate is 10.35/(12 x 100).
For example: If you take a car loan for Rs. 4,00,000 at an interest rate of 10.35% with a loan tenure of 7 years, the projection of EMI and interest payable would be as follows - EMI payable per month would be Rs. 6,713, total interest payable would be Rs.1,63,895/-, and the total payment made by you at the end of the loan term will be Rs. 5,63,895.
In the following example, you will get a clear idea of break-up of EMI on a loan amount of Rs. 5 lakhs for a loan term of 3 years at an interest rate of 10.35%. EMI per month is calculated from Oct 2016 to Sept 2018.
|EMI||Principal||Interest Amount||Total EMI Payment (Principal + Interest)||Balance Due|
|Oct 2016||Rs. 11,903||Rs. 4,312||Rs. 16,216||Rs. 4,88,097|
|Nov 2016||Rs. 12,006||Rs. 4,210||Rs. 16,216||Rs. 4,76,091|
|Dec 2016||Rs. 12,110||Rs. 4,106||Rs. 16,216||Rs. 4,63,981|
The following projection shows the total yearly EMI and repayment schedule for the loan term of 3 years, beginning from October 2015:
|Year||Principal||Interest Amount||Total EMI Payment||Balance Due|
|2015||Rs. 36,019||Rs. 12,629||Rs. 48,648||Rs. 4,63,981|
|2016||Rs. 1,53,725||Rs. 40,865||Rs. 1,94,591||Rs. 3,10,256|
|2017||Rs. 1,70,413||Rs. 24,178||Rs. 1,94,591||Rs. 1,39,843|
|2018||Rs. 1,39,843||Rs. 6,100||Rs. 1,45,943||Rs. 0|
In this scenario, loan EMI per month would be around Rs. 16,216 and the Total Interest Payable would be Rs. 83,772. Therefore, the total payment that you will have to make by the end of the loan tenure is Rs. 5,83,772.
Syndicate bank and other banking and non-banking institutions have access to the CIBIL score of an applicant. The CIBIL TransUnion Score is a 3 digit number which ranges from 300 up to 900. This is scrutinized in-depth so that the Bank can evaluate an individual’s eligibility for a loan as well as the risk involved in lending out credit to an applicant. The credit history of an individual clearly portrays all his outstanding dues, income earned, repayment history, defaults on credit payments, etc. An individual who has a good credit history will have a high CIBIL score and are considered creditworthy by the concerned bank. A person having a CIBIL Score of 700-750 and above is considered an ideal CIBIL score by most banks, to approve a loan to. Higher scores ensure greater probability of procuring car loans at an attractive rate of interest since it reflects a lower risk on loan defaults. Hence, borrowers with a high CIBIL score can easily avail loans compared to those with low CIBIL scores.
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