It is everyone’s dream to have a branded car along with the house. Car not only makes your life comfortable but also reduces many difficulties. Coming to the office while battling public transport or going out for a weekend trip, everything becomes very easy.
Earlier, buying a car was a big deal for anyone, as a lump sum amount had to be spent for it, but now it has become very easy due to the easy availability of car loans. Banks and non-banking finance companies offer car loans on easy monthly installments, which has made buying a car very easy now. This does not spoil your budget and also provides convenience.
companies offer loans on both new and used cars. However, the interest rates on these two are different. The interest rates for new cars range between 9.25 -13.75 percent, while for used cars the interest rates range between 12.50 and 17.50 percent.
Who can take a Car Loan?
Before applying for the loan, there are some conditions, which you need to keep in mind. This includes information about age, minimum salary, type of job, and residence
When you buy a car by taking a loan, it is mortgaged with the lending company. This gives them the right to confiscate your property in case they are unable to repay your loan. If you are not able to pay the monthly installment on time, they can pick up the car and take it away.
Hypothecation letter is also a part of the car registration process. Once you repay the loan, you can remove the hypothecation of the lending company from the registration papers.
To remove the hypothecation, you will have to go to the concerned registration transport office with no objection certificate, car insurance papers, and address proof. It is important to note here that it is necessary to take NOC from the company giving the loan. After this, give it to the insurance company and issue the insurance paper in the name of the new owner.
Car Loan Amount The amount
loan depends on your age and income. How much loan you get for the car depends on the lending company. At this time, usually, you get a car loan up to four to six times your annual income.
Up to 80-90 percent of the cost of the car gets financed. Some banks, however, finance up to 100%. It can be ex-showroom price or on-road price.