One thing which can give you sleepless nights. If you land up with wrong financier for any kind of loan.
But, on the other hand. If you make a right decision and do all the possible research before applying for a loan.
Undoubtedly! you will be on a much much safer side by having nothing to worry about. Provided!!
You continue to pay the due amount every month (EMI) without fail! 🙂
Want to know more about EMI. Bet you should read this post of mine.
Okay!! Too much of gyan on general terminology of loan though!
Yes, coming to CAR Loan!!
According to me. Personally having studied many lenders of loan while I had to purchase my car.
This is what I did. These 4 things which I checked has made life a much easier and simpler. Because I have nothing to worry about except to pay the monthly EMI without fail.
- Loan Amount:
Ah! common ideally any person looking for a car loan will already have some idea as to how much loan amount will be required to purchase a car.
Generally, banks will be ready to pay the borrower upto 90% of the On Road Price of the vehicle.
Or, If you seem to be more lucky enough and they consider you to be one among their privileged customer and you are associated with the bank from many years or since a decade. Then they would not hesitate to even lend you upto 100% (Chances of this being very less).
So based on the amount you have in your savings which you can utilize to pay as a down payment to purchase the car. Decide the loan amount more wisely.
Lesser the loan amount = Lesser interest payable at the end of the tenure
- Loan Tenure:
Minimum duration any bank provides a car loan is for 1 year and maximum being 7 years for a New Car.
So first thing what I did was to decide as to which tenure if I select would be more feasible and better for me.
Well, In my case. I wanted maximum amount of loan. So one way for me to do was to go for a longer tenure.
More the tenure = More loan amount you are eligible to get (Be informed, this will also lead to pay more interest amount at the end of tenure)
- Rate of Interest:
Average Rate of Interest of best banks lending car loan ranges from 8.35% to 14.74%.
Once you made up your mind on tenure of the loan. Be calculative about what will be the best interest to go with. Keeping in mind the tenure you have decided to take.
Ideally, If you choose for longer tenure. Best thing to do is to choose the bank which will provide you the least rate of interest on the loan amount.
By doing this, you can save lots of money on interest being paid by the end of tenure.
It is always advisable to go for the bank which will provide you the provision of “NIL” almost negligible processing or foreclosure charges for the car loan amount.
Ideally, most of the banks charge premium on these charges. So it was always to important to notice this before applying for any banks for a Car Loan.
Conclusion: Once you are clear with these things as mentioned in the above post. This will ease your process of choosing the best loan based on your requirement and ease of applying and repaying the loan.
Hope so this post was of some help for you!
Keep reading and sharing if you like the posts I write!
If you think I need to add some more points or missed out on anything. Do comment your thoughts on the above written post.