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  • Car Loans in Vadodara

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  • Residents of Vadodara can avail car loans from a variety of popular banks in Gujarat. Car loan interest rates start from just 8.40% p.a. and processing fees can be as low as Rs.500. Loan tenures for new cars can extend up to 7 years and 5 years for used/pre-owned card.
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    Car Loans in Vadodara – Overview

    Majority of the car loans offered in Vadodara are floating-rate loans wherein the benchmark rate of the lender or the MCLR (Marginal Cost of funds-based Lending Rate) determine the interest rate applicable to the loan. In case you are looking to purchase a new four-wheeler in Vadodara, a new car loan can be an attractive option, while pre-owned car loans are ideal for those who wish to purchase a second hand car in Vadodara.

    The repayment tenure for new car loans is generally longer, extending up to 7 years or 84 months. The repayment tenure for a loan for the purchase of a second hand vehicle, however, is relatively shorter at 5 years or 60 months. It is mandatory for all cars to be hypothecated to the bank from which the car loan is availed.

    Interest Rates Offered by Top Lenders on Car Loans in Vadodara

    Here are some of the best banks in Vadodara, Gujarat offering car loans, along with their interest rates and processing fees:

    Bank Interest Rate for New Cars (p.a.) Interest Rate for Used Cars Processing Fee
    Bank of Baroda 8.60% Rs.500 (flat fee)
    HDFC Bank 8.40% 0.40% of the loan amount subject to a minimum of Rs.3,000 and a maximum of Rs.10,000
    Union Bank of India 9.05% 12.05% Rs.1,000 (flat fee)
    State Bank of India 8.80% to 9.50% 10.50% to 12% 0.51% of the loan amount
    Axis Bank 9.25% onwards 14.80% onwards Rs.3,500 to Rs.5,500 for new cars and 1% of loan amount subject to a maximum of Rs.6,000 for used cars
    Indian Overseas Bank 8.95% 9.95% to 10.95% 0.50% or 0.60% of loan amount subject to a minimum of Rs.500 and a maximum of Rs.10,000
    ICICI Bank 9.30% to 12.85% 14.25% Rs.3,500 to Rs.8,500 for new cars and 2% of loan amount subject to a maximum of Rs.15,000 for used cars
    Corporation Bank 9.30% for loan amounts up to Rs.50 lakh 9.80% for loan amounts above Rs.50 lakh 9.30% for loan amounts up to Rs.50 lakh 9.80% for loan amounts above Rs.50 lakh 1% of loan amount subject to a minimum of Rs.1,000
    Bank of India 8.60% to 9.20% 8.60% to 9.20% 0.25% of the loan amount subject to a minimum of Rs.1,000 and a maximum of Rs.5,000
    Canara Bank 8.75% to 11.30% 8.75% to 11.30% 0.25% of the loan amount subject to a minimum of Rs.1,000 and a maximum of Rs.5,000

    How to Get the Lowest Interest Rates on Car Loans in Vadodara

    Besides a thorough comparison of the different car loan schemes offered by various banks, there are a few other ways through which you can avail the lowest interest rates on your car loan in Vadodara. Here they are:

    1. Ensure that your credit score is high
    2. A number of lenders across Vadodara offer lower interest rates to customers whose credit scores are above 750. A lower credit score would mean that the interest rate offered to you could be quite high. A higher credit score, on the other hand, ensures relatively favourable terms and conditions.

    3. Lower interest rates for new car loans
    4. The interest rate offered to customers who wish to purchase second hand cars is relatively high in comparison with the interest rates offered for the purchase of new cars. Certain lenders offer the same interest rates for both new car loans as well as used car loans. The down payment or margin to be paid by the applicant is also quite high for used car loans in comparison with new car loans. The margin for used cars can be as high as 40%, while the margin for new cars can range from 10% to 25%. In case you are going in for a used car loan, you must take into consideration several factors such as the down payment, the interest rates, and the vehicle’s age.

    5. Lower rates for salaried employees in comparison with self-employed individuals
    6. The interest rates offered to salaried applicants is usually lower in comparison with the interest rates offered to self-employed individuals. This applies not only to car loans but all other kind of loans. The reason for this is that salaried applicants derive a fixed income each month, thereby making the less risky in comparison with self-employed individuals whose income varies each month.

    7. Lower interest rates for women
    8. A number of banks in Vadodara offer lower interest rates on car loans to female borrowers. Although the difference between the rates offered to women and men is marginal, the amount of money that can be saved on interest is quite significant. If you are a woman seeking a car loan in Vadodara, you can find several banks and financial institutions that will offer you the amount you require for a slightly lower interest rate.

    9. Lower interest rates for longer tenures

    If the main factor you take into consideration when applying for a car loan is the interest rate, you can go for a longer repayment tenure as the longer the tenure, the lower the interest rate. Another advantage of taking a loan with a longer repayment tenure is that the EMIs are also smaller. The issue with longer tenures, however, is that you end up paying a lot by way of interest. If you wish to save on the money you would otherwise pay as interest, a shorter tenure would work best for you, but the EMIs will be higher so make sure you can afford to make the payment each month before you sign on the dotted line.

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    Eligibility for Availing a Car Loan in Vadodara

    Eligibility Parameters Eligibility Criteria
    Minimum and Maximum Age
    • Minimum age: 21 years
    • Maximum age: 70 years
    Minimum annual income Rs.1.80 lakh and above
    Employment requirement
    • Salaried applicants: Must be employed continuously for at least 1 year
    • Self-employed applicants: Must be in business for a period of two to three years

    Documents Required

    The documents you will have to submit at the time of availing a car loan in Vadodara will depend on your employment type. Here are the documents required for both salaried applicants as well as self-employed individuals when applying for a car loan in Vadodara:

    Documents Salaried employees Self-employed individuals
    ID proof PAN, Aadhaar, Voter ID, Passport, Driving License, any other ID issued by the government PAN, Aadhaar, Voter ID, Passport, Driving License, any other ID issued by the government
    Address proof or Office/Business proof Aadhaar Card, Passport PAN, Utility bill, Ration Card, Driving License, any other ID issued by the government Electricity/Telephone bill, VAT or Sales Tax Certificate, Shop & Establishment Act Certificate, Registered Lease with other utility bills, MSME or SSI Registration Certificate, Current Account Statement
    Proof of date of birth Birth certificate, passport, Aadhaar with full DOB, any other ID issued by the government Birth certificate, passport, Aadhaar with full DOB, any other ID issued by the government
    Signature Verification Passport, Banker’s verification, PAN Passport, Banker’s verification, PAN
    Income documents Salary slips, Income tax returns, Latest Form 16 Income tax returns, Audited Balance Sheet and Profit and Loss Statement for at least two years
    Other documents Passport size photographs Passport size photographs

    Frequently Asked Questions for Car Loans in Vadodara

    1. Is it possible to apply for a car loan online?
    2. Yes, it is possible to apply for a car loan online. Most major banks and financial institutions have online application forms that must be filled and submitted along with your documents when applying for a car loan online. Make sure you double-check with your preferred bank if they accept online applications.

    3. Do I need a collateral or security to apply for a car loan?
    4. No, you do not require any additional collateral or security when applying for a car loan. The car itself will act as a collateral and in case borrowers are unable to repay the loan, the bank has the authority to seize the vehicle. However, you will have to ensure that the car’s registration certificate is endorsed with the bank.

    5. Am I allowed to prepay my car loan?
    6. Yes, majority of the banks and financial institutions allow you to prepay your car loan. While some banks allow you to prepay the car loan without charging you any additional fees, some banks charge a prepayment fees in case you wish to prepay your loan.

    7. Will I get lower interest rates in case I have a salary account with the bank from which I want to take a car loan?
    8. It depends from bank to bank. Some banks tend to offer special offers to their long-standing customers who have a good relationship with them. However, it is essential to ensure that your credit score is excellent if you wish to ask your bank for lower rates.

    9. What is the maximum loan amount I can avail for a car loan?
    10. The maximum amount that you can borrow would depend on the bank from which you are taking the loan. Each bank has its own limits and caps, but usually, you can expect to avail 80% to 90% of the value of the vehicle as a car loan.

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