United Bank of India Car Loan Interest Rates

Factors affecting United Bank of India Car Loan Interest Rates

The interest rates for a United Bank of India Car Loan will typically be based on various factors along with the applicant's financial profile. Some of the important factors that can have an impact on the interest rates have been listed below:

1. Down payment: Financial experts always suggest that customers should make higher down payments to lower the burden of repayments. Higher down payments will also help customers shorten their loan tenures and reduce the EMI amounts, thereby cutting the total cost of the car loan.
2. Collateral: If you furnish 50% of your loan value as collateral, you will be entitled to a concession of 0.25% on your interest rate. The collateral will need to be a tangible security or in the form of liquid.
3. Income: A customer's income plays a vital role in determining the interest rate for a car loan. If the applicant has an acceptable income, then he will be able to make a higher down payment amount, thereby getting a car loan deal at low interest rates. To improve the income criteria, customers can opt for a co-applicant, where the bank will consider the combined income of both the applicants.
4. Credit score: Most banks approve car loans based on the credit score and credit history of an applicant. It is very important that every applicant presents a good score to get an affordable car loan deal. A good score is a reflection of the customer's regular payment patterns and efficient money management capabilities. Having a high CIBIL score boosts the bank's confidence in the customer and this might open various avenues for the borrower to save money. Lending institutions might not sanction car loans for applicants with bad scores and even if they do offer a loan package, it will be at high interest rates.
5. Existing debts: As a general rule, customers should apply for any kind of loan with minimum liabilities and outstanding debts. The debt-to-income ratio is an important factor that banks consider while granting car loans. Any borrower should be able to comfortably repay the new car loan along with his/her current liabilities and commitments.
6. Loan tenure: When a car loan is availed, customers should always opt for shorter tenures. Longer tenures attract more interest rate charges. If the tenure is short and if the customer has made a huge down payment amount, then the lender will most likely give the applicant the best interest rates.

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