Used cars, second-hand cars or pre-owned cars have become popular amongst consumers nowadays. This is mainly due to the establishment of several organised used car dealerships across the country. These reliable car dealerships ensure that the second-hand cars are certified and well-maintained. When purchasing a used car from a private dealer, there is a worry of whether the car is a stolen property or if it is in working condition. You can do without this sort of stress when dealing with a reputable auto dealership.
The adage ‘old is sold’, rule applies to almost all our material possessions that are deemed aged, redundant and replaceable. A used car loan helps you procure an otherwise costly item that in mint condition, would cost you a lot higher than its current ‘pre-owned’ state. Thus, allowing people with lower budgets to elevate themselves to the status of car owners.
Apart from being a very comfortable option to purchase a ‘new’ car, a used car loan offers a dimension of simplicity, transparency and hassle-free experience that is at par, and at times significantly higher than the corresponding car loan procedure for a new automobile. Want to own a car but are not willing to spend too much into the experience? What you seek is a well-maintained, reliable and springy used car that has aged gracefully, and consequently, a second-hand car loan to purchase it.
On Bankbazaar.com, you can get a comprehensive glimpse of the various features, interest rates, eligibility criteria, and required documentation for a second-hand car loan as offered by an assortment of banks and financial institutions across India. All the information you want can be accessed in one single platform.
Applying for a Used Car Loan on Bankbazaar is a Simple and Intuitive 3-Step Process:
Step 1- On Bankbazaar.com’s homepage, access the navigational menu that is located at the top of the page and select the LOANS menu item. Next, select the USED CAR LOAN option off the various loan types listed. The resultant page helps you get an instant quote in terms of a plethora of used car loan options, as offered by various banks. Complete the simple requisite information and click on the ‘Get a Quote’ button. Now, spread before you are the various loan options. It’s time to choose!
Step 2- You must compare between the various second-hand car loan options before you and select the one that most appeals to your requirements and budget.
Step 3- After the submission of the online application, you will receive an instant e-approval from Bankbazaar.com. This application is next transferred to your chosen bank from wherein a customer support executive will get in touch with you within a short duration of time. Meanwhile, you can track your application through SMS alerts and email.
Used car loans are repaid through Equated Monthly Installments (EMIs). You can use the online car loan EMI calculator that is available on the bank website to find out how much your used car loan will cost you on a monthly basis. The tool is easy and simple to use. It can be used any number of times for free. You can enter varying combinations of the loan amount, interest rate, and loan tenure to get revised loan repayment schedules. The tool will display instant and accurate results in the form of an amortisation table which represents the periodic loan repayment schedule of your used car loan.
The friendly financial tools available on our website make the whole EMI calculation process, as applicable to your old car loan, a simple and interactive effort. Essentially, follow these steps-
Based on individual banks, all or some of these documents will be requested to be produced at the time of the loan application:
The following list is a generalised view on the commonly expected requirements that form the basic eligibility criteria for second hand car loans. Banks, at their own discretion, may require additional proof and/or documentation to establish your eligibility for the said loan.
(* Numbers may vary for different banks)
The situation with used car loan interest rates, as perceived by the loaning banks, can be summed up as ‘great risks, greater rewards’. The banks are funding an old car, thus the funds offered are lesser as compared to a new car loan. Also, most second-hand car loans offer the option of pre-payment with a very nominal penalty- a situation that is a likely scenario in cases wherein the old car may suffer a functional meltdown through the tenure period, and the car owner might decide to repay the loan at one go. Thus, understandably, the interest rates on used car loans is greater when compared to new car loans. In terms of the popular reducing balance model, the interest rates offered by some popular Indian banks are as follows:
|Banks||Interest Rates 2019|
|State Bank of India (SBI)||
|Bank of India (BOI)||1 Year MCLR + 0.85%|
|Axis Bank||Up to 36 months repayment tenure – 15% to 17% Repayment tenure exceeding 36 months – 15% to 17%|
Automobile refinancing is done by paying off an existing loan with a new loan. Refinancing a car loan is done for a number of reasons like reducing interest rates, lower the payments that have to be made every month or for other personal reasons. Most of the time people would want to lower the amount that they pay on a monthly basis towards a loan. This is done by either lowering the interest rates, by extending the loan payment period or by doing both.
Sometimes a car loan borrower will want to add someone or remove their names from the car loan. Refinancing is an easy way to add or remove a cosigner to the loan.
HDFC Bank- One of India’s premier banking organizations, HDFC Bank is highly preferred when it comes to used car loans. The bank has strategic tie-ups with a number of authorized pre-owned car dealers in India and highlights its offerings with a commitment towards faster loan approval and convenient doorstep service. Some of the basic features and benefits of HDFC Used Car Loan are listed below-
SBI Bank - India’s largest public sector bank is also a key player when it comes to used car finance. This loan applies for the purchase of a used vehicle that isn’t older than 5 years and may either be a passenger car, Multi Utility Vehicle (MUV) or Sports Utility Vehicle (SUV). The repayment tenure on offer is the longest in the Indian context, stretching up to 84 months. A listing of the features and benefits of SBI Used Car Loan are as follows-
ICICI Bank- One of India’s premier private sector bank, ICICI, is also a leading lender of used car loans. The loans on offer are highly customer centric and loaded with an attractive array of features and benefits that will appeal to the most discerning potential customer. The highlights of an ICICI Bank second hand car loan are as follows-
IndusInd Bank- An active player in the sphere of used car finance, IndusInd Bank offers comprehensive loan options when it comes to the purchase of a used car for personal or commercial use. The loan is offered for all makes and types of cars available in India. The salient features of this loan are as follows-
Capital First Used Car Loan - Capital First is a Non-Banking Financial Corporation that offers a wide variety of financial services to customers from different income groups with varying financial needs. One of its most popular products is the used car loan scheme called Used Car Elite Program, which offers finance for purchase of used cars at a low rate of interest. Customers can avail an LTV of 100% under this scheme. Some of the main features and benefits of Capital First Used Car Loan are as follows:
TVS Credit Services Limited- The loans on offer here are very affordable, with the availability of a wide range of flexible pre-owned car loan schemes. The company also boasts of a quick turnaround time, robust customer service and adherence to a transparent and customer friendly loan approval and disbursement process. The salient features of TVS Credit Used Car Loans are as follows-
The ideal choice is to compare the various pre-owned car loan options available online and apply instantly through the same medium. The contacted bank will reach out to you at a later date to finalize and confirm upon the associated documentation and other details.
No, most banks do not require a guarantor but may ask you to involve your parent/spouse/ offspring as a co-applicant if your income doesn’t meet the set eligibility criteria.
Any automobile available in the market. Some banks may finance vehicles that are only manufactured by an Indian company, but usually there are no restrictions in terms of the type and brand of vehicle available on the menu.
Usually, the loans on offer fund anywhere from 80%-100% of the used car’s on-road price.
This activity is known as ‘refinancing’ and it is a possibility with many banks. The value of the car can be encashed to meet your immediate monetary requirements, even while you actively continue to use the car. Ideally, you can avail up to 80%- 85% of the car’s valuation amount.
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