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    Jammu and Kashmir Bank Used Car Loans

    The Jammu and Kashmir Bank was established on 1st October in the year 1938, thanks to the commendable effort by the Maharaja Hari Singh of Jammu and Kashmir. The Maharaja had requested prominent Kashmiri financiers to be the board directors and stakeholders of the bank, the most outstanding of which were the Bhaghat clan and Abdul Aziz Mantoo and Pesten Gee, all of whom obtained key shares. The bank initiated its operations on 4th July 1939, almost a year after its launch, and was regarded the first of its kind and structure as a bank run by the State in India. What started off as a semi-State Bank with contribution from the capital as well as the public, attained the position of a scheduled bank and was announced as an ‘A’ Class bank in 1976 by the Reserve Bank of India.

    Car Loan for Used Cars- Prerequisites:

    • Jammu and Kashmir Used Car Loan is accessible for anyone who wants to buy an old car or jeep of any model, which is not older than 5 years.
    • You can avail this if you are permanent government or semi-government servants, employees of autonomous or private organizations, entrepreneurs or independent professionals.
    • The loan applicant must be of at least age 21 when applying and should not be older than age 58 (or the applicable retirement age in the institution) when the loan tenure ends.
    • Least expected period of present employment for salaried and self-employed person as well as collaboration is 3 years. If the salary is drawn through a home branch, then this period is reduced to 2 years.
    • There is a margin of 25 percent for cars used for less than 3 years and 30 percent for those used for more than 3 years (and less than 5 years).
    • The maximum used car loan sum permitted by J & K bank is 2.5 times of your total yearly earnings or 1.5 million, whichever is less.
    • The number of cars to be authorized to one debtor under Car Finance (Used) at any given time must not go beyond 2 cars within the agreed limit of INR 1.5 million.
    • For cars used for less than 3 years, you can take up to 72 months to repay the loan. And loans for cars used for 3 to 5 years should be paid in 48 months.
    • Primary security asked by the bank is the hypothecation of car, which is to be bought.
    • There shall be no need for any third party assurance if you are an employee drawing your salary through any of the J & K home branches.
    • Advance payment of any amount permitted any time after a term of 6 months will be levied a small penalty of 2 percent for the sum prepaid.
    • There shall be no upfront costs.

    Jammu and Kashmir Bank Used Car Loan Interest Rates

    J&K Bank offers its customers a specialised used car loan, helping them finance a pre-owned 4-wheeler. Interest rates for this loan depend on the date of sanction, with an MCLR and Base Rate platform in place. Existing borrowers have the flexibility to choose between either of these systems, while new borrowers will automatically be moved to MCLR based rates.

    Jammu and Kashmir Bank Marginal Cost of Funds Based Lending Rate (MCLR) (For new borrowers)

    J&K Bank has introduced MCLR based benchmark rates following guidelines from the RBI. These rates are indicative of current scenarios, highlighting the operating costs, repo rate, CRR, etc.

    MCLR Benchmark Tenure (Period) Benchmark Rates (MCLR)
    Overnight 9.25%
    1 month 9.30%
    3 months 9.35%
    6 months 9.40%
    1 year 9.45%
    2 years 9.55%
    3 years 9.60%

    Used car loan interest rates – May 2016

    The interest payable on a used car loan depends on the tenure and MCLR. Jammu and Kashmir Bank can modify the interest, choosing to add a certain percentage over and above the existing MCLR, depending on certain factors.

    Jammu and Kashmir Bank Base and Prime Lending Rates (For existing borrowers)

    Base Rate 9.50% per annum, effective July 1, 2015
    Prime Lending Rate 14% per annum, effective July 1, 2015

    Jammu and Kashmir Bank interest rate for used cars (Based on Base Rate)

    Existing customers who do not wish to migrate to the MCLR based platform can continue paying interest calculated on the basis of the base rate. The table highlights the different rates applicable.

    Tenure Interest Rate
    Less than 4 years 15.25% per annum
    More than 4 years 16.00% per annum

    Note: Jammu and Kashmir Bank holds the right to modify/change interest rates without prior intimation. Rates mentioned here are as of June 7, 2016. Potential borrowers are advised to check prevailing rates at the time of applying.

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