Cheapest Car Loan: For many, car ownership is no longer a luxury, but a necessity. Buying a car is probably the second most expensive purchase of a person’s life after buying a home. Many people buy a car with a loan. Banks are also among the financial institutions providing car loans. The interest rate is the main thing to keep in mind while taking a car loan like any other loan.
Those who want to get a car loan should take a loan from a bank that offers a low interest rate loan. Here are the interest rates on car loans from State Bank of India (SBI), ICICI Bank, HDFC Bank and Bank of Baroda.
SBI car loan
According to SBI’s website, you must be between 21 and 67 years of age to get a car loan from SBI. Regular employees can be granted loans up to 48 times their net monthly income. According to the website, if the net of the applicant or co-applicant is annual, it should be at least Rs. Should be 3,00,000.
For professionals, self-employed and businessmen, loans up to 4 times the gross taxable income as per income tax return after inclusion of net profit or past depreciation and repayment of all existing loans may be approved. A person working in agriculture and allied activities gets a loan of 3 times the maximum amount of net annual income.
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ICICI Bank Car Loan
New car loan with fixed interest rate is offered by ICICI Bank. This fixed interest rate will remain the same till the loan is completed. The interest rate varies between 7.50% and 9% depending on the loan repayment period and other factors. According to the bank’s website, interest rates on new cars are determined based on factors such as the automobile segment, CIBIL score, customer relationship, loan term, etc.
Bank Of Baroda Car Loan
According to the Bank of Baroda website, it lends up to 90 per cent. Interest rates range from 7 to 9.75 percent. Customers who do not purchase credit insurance will be charged 0.05% risk premium as per existing rules.
HDFC Bank Car Loan
Repayment is not allowed in HDFC Bank within six months of taking the car loan. According to HDFC Bank’s website, the 7th EMI will charge 6% of the principal outstanding on the pre-closure within a year.
Within 13-24 months of the first EMI, the pre-closure is charged 5 per cent of the principal amount outstanding and 3 per cent of the outstanding amount after 24 months.
The eligibility of your car loan is determined by evaluating your repayment capacity based on your current income, car price and your current expenses. The loan amount and interest rate may vary from bank to bank. In most cases, financial institutions, such as banks, lend up to 80 percent of the car’s on-road value. Some lenders claim to lend up to 100 percent of the cost of the car.
When getting a car loan, it is important that you choose the monthly installments according to your ability to pay. Don’t choose low EMI and long term loan, as you have the option. Choose the option that is most affordable.
This is because the lower the EMI and the longer the loan term, the higher the interest rate unnecessarily. Regardless of the loan amount, make sure your EMI is manageable and do not overload your resources. Also, you should not keep a big EMI by sacrificing important financial goals. Before the loan amount, you should keep in mind how much EMI you can easily pay.
Loan holders typically offer new car loans with terms ranging from one to seven years. You have the option of choosing a loan term that suits your needs.
Many banks charge a processing fee when applying for a car loan. Before choosing a loan, consider the processing fees. Some banks offer a waiver of processing costs during the festive season or even a reduction in their existing rates.