Lending companies give loans on both new and second Vehicle. However, the interest rates on these two are different. The rate of interest for a replacement vehicle is between 9.25 -13.75 per cent, while the rate of interest on old cars is between 12.50 and 17.50 per cent.
Who can take a vehicle loan?
There are some conditions before applying for a Vehicle loan, which you want to look out of. It includes information about age, minimum salary, sort of job and residence.
Proof of income like three months salary slip, six months statement, tax returns.
Some companies don’t finalize loans without a Vehicle insurance copy and driver’s license.
loan depends on your age and income. what proportion loan you get for the car depends on the lending company. At this point, usually, a Vehicle loan is out there for four to 6 times of your annual income.
Up to 80-90 per cent of the worth of the vehicle is financed. However, some banks finance up to 100 per cent. It is often ex-showroom price or on-road price.
Ex-showroom price is the amount paid to a dealer instead of in place of shopping for a car. Once you bring the car to run on the road after paying the registration charge, insurance, road tax etc. then it’s the on-road price.
When you choose an automobile loan for a second user car, then the expenses incurred in re-registration aren’t covered.
What are the expenses during a Vehicle loan?
Banks charge tons for giving loans or repaying loans before time.
- Processing fees are charged once you apply.
- This can be 0.4-1 per cent of the loan amount.
- Banks charge fees for repaying the loan before time.
- Some banks charge between five and 6 per cent on this. However, some banks don’t charge for it.
Some banks offer part payment facility to repay a Vehicle loan. This suggests that whenever you’ve got money, you’ll repay a neighbourhood of the loan. Some banks also charge on payment. you can’t repay the loan within six months of taking a Vehicle loan.