Once a person is satisfied with all the basic needs in life then he will lookout for a luxurious life. A person always tends to seek for the betterment of living standards. Having a car is one such instance. During the olden days, only the rich and privileged people could afford a car. Whereas, for the poor and middle-class people, owning a car is something they could only dream of. You can go for a car loan if you want to.
Nowadays anyone from a sustainable financial background can afford a car, thanks to the several schemes and car loans being offered by the banks. You just need to visit your nearest car showroom where you’ll come across bank representatives.
Every bank has different criteria for car loan finance which you can choose according to requirements and if you can meet up with certain criteria you’ll be furnished with the cost of the vehicle as a loan.
How Much Loan Will You Be Offered?
Buying a car loan is not associated with your budget; however, EMI should not exceed 20% of your monthly income. You need to keep in mind that the furnished loan is given to you against the ownership of your car.
If you fail to reimburse the loan, the bank has all the right to seize your car and sell it to recover the loan. Some banks first confirm your credit rating then proceed to loan.
If you have a bad credit rating you can face some difficulties in getting a car loan. However, you can still able to take the loan then you can pay installments in time and improve your credit ratings.
According to many experts, the best way to go about this process is to have some money of your own first of all. Even though there are people who opt for entire car financing, it is always not recommended.
If you are not so sure of your income the case could be even worse. Suppose you acquire a car on loan and you get fired after some time. In such a case you will have to deal with the embarrassments of seeing your car getting towed.
If you had some money of your own and only went for half financing then you will be in a much better situation. Also acquiring a very expensive car on loan is always not recommended.
It will not sound right for you to start thinking of owning a top-class range rover when you face financial constraints.
Only a modest vehicle will work for you. Such vehicles will mean you will spend so much time paying for them this might even block you from doing some other important things in your life.
Sometimes back send their representatives to advice people accordingly on this issue. There are very good vehicles that you can find at very manageable prices. Try and avoid going for vehicles that you will struggle to pay for.
Tenure of the Loan:
A bank furnished the loan from anywhere between 1-7 years. It depends on your repayment capacity. According to your capacity, you can opt for a suitable tenure. The lower the tenure, the lower is the interest.
Since the tenure is less you must pay higher EMI, and hence you’ll have to pay less interest. If you are willing to re-sell the car and opt for a bigger car vehicle with no loan amount is much easier to sell. If you are going for a higher tenure the EMI is less and easy on your pocket.
Even though the need to own a motor vehicle might cut across, that might not be the case with income. People earn money in different capacities. It is important for you to take your time and establish the tenure that will favor you the most.
However, it is advisable to go for shorter loan tenure. This makes a lot of economic sense. First of all, you will pay so little in terms of interest. The second thing is that you will be able to pay for your vehicle on time and acquire its full ownership.
Given these factors, you can even sacrifice so as to pay for your acquired on time. This will also give you the peace of mind to move on to other projects as well. However, if you have a lower repayment capacity then a longer repayment tenure will be the best for you.
A person living in India needs to provide certain documents before applying for a car loan. Such documents include Permanent Account Number (PAN) Card, Driving License, Andhra Card, Voter Id Card or Passport as identity proof.
The person is also required to submit proof of age and a recent passport size picture. For the proof of income, the person is required to submit the following documents. Three-month salary slips, at least 6 months of salary bank statement and income tax return.
These documents should be self-attested along with the document of the car.
Important Points to Consider:
When buying a car it is very important to consider all the buying options. You should also think about which car you should opt for. You need to have a proper idea about how you are going to pay for it and several different options.
Each option has its pros and cons. While you are on a bad credit getting a car loan can seem a hell of a struggle. There are still some options available to get a car loan even if your credit is not clean.
Keeping an eye on several schemes offered by different banks is the key here. Nowadays there are several different mobile applications. These applications are available for you to compare EMIs offered by different banks and choose one best one that suits you.
If you are unable to arrive at a suitable decision you can seek help on the same issue. There are so many people who can assist you like bank representatives and other experts. However, you need to know that the kind of advice you get from banks might not be that perfect.
Most banks give advice that also considers their interests to a larger extent. There are so many other alternative experts that can guide you accordingly on this issue. You need to have a variety of options to choose from.
Do not make the wrong decision that you may end up regretting later on. You need to pay a lot of attention to everything and make sure you get the best deal.
On a different note, the market is filled with fraud. When you are going to spend so much money on a car, it is always better to buy from the trusted suppliers and contact directly to the bank to avoid any fraud and miscommunications. Check the documents carefully before signing them and handing over to your bank agent. After all, when you are driving away your new car, you’ll enjoy a swift ride, isn’t it?
Owning a car nowadays is very easy. There are so many approaches that you can use to arrive at this goal. If you do not have the cash a car loan is the best option. However, when acquiring a car on loan there are so many things you need to consider.
You have to make sure you understand all the policies pertaining to the same before making up your mind. If you are not so sure you can seek help on the same. You will be able to get a car loan easier than you ever thought. It is one of the best things that ever happened to those people who desire to get a loan.