Car Loan

A Car Loan is an secured loan provided by banks and financial institutions to meet personal exigencies.

Car Loan Overview

A Car Loan is a loan for your personal use, be it your child’s wedding, a dream vacation, or a shopping extravaganza. A Car Loan does not require any security or collateral and can be availed without much fuss. Typically Car Loans range from Rs. 50,000 to Rs. 30 Lacs with a tenure typically ranging from one to five years. Getting a Car Loan is quite stress free and there are typically a number of offers in the market most of the time.

Apart from the rate of interest banks also charge some fees which are usually of two types. Once when you are applying for the loan and once when you are pre-closing the loan. The fees when charged at the time of processing called as Processing Fees vary from 2-3% of the loan amount. This could be reduced if you have the ability to bargain. the second charge is the prepayment penalty paid at the time of pre-closure. This too varies from 2 – 3 %. Similar to processing charges, you can also try to get this fees reduced.

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Car Loan Interest Rate

Car loan Banks Interest Rates EMI per Rs 1 lakh for 7 Years
Axis Bank 8.50% - 11.25% Rs. 1,584 - Rs. 1,725
Bank Of Baroda 8.80% - 10.55% Rs. 1,599 - Rs. 1,689
Bank of Maharashtra 8.90% Rs. 1,604
Canara Bank 8.70% - 9.35% Rs. 1,594 - Rs. 1,627
Central Bank of India 8.85% - 9.95% Rs. 1,601 - Rs. 1,658
Corporation Bank 8.75% - 9.50% Rs. 1,596 - Rs. 1,634
HDFC Bank 8.50% - 11.25% Rs. 1,584 - Rs. 1,725
ICICI Bank 8.82% - 12.75% Rs. 1,600 - Rs. 1,806
IDBI Bank 9.00% - 9.10% Rs. 1,609 - Rs. 1,614
Indian Bank 9.00% Rs. 1,609
Union Bank Of India 8.85% - 11.85% Rs. 1,601 - Rs. 1,757
Oriental Bank of Commerce 8.50% - 9.00% Rs. 1,584 - Rs. 1,609
Punjab National Bank 8.90% - 9.10% Rs. 1,604 - Rs. 1,614
State Bank of India 8.90% - 9.20% Rs. 1,604 - Rs. 1,619
Uco Bank 8.85% Rs. 1,601
Bank of India 8.90% Rs. 1,604
United Bank of India 8.85% - 8.90% Rs. 1,601 - Rs. 1,604
Syndicate Bank 8.95% Rs. 1,606
Dena Bank 9.10% Rs.1,614

Documents Required for Car Loan

Particulars Salaried IndividualSelf-Employed IndividualPartnership FirmPrivate / Public Ltd Co
Age CriteriaThe applicant should be above 25 years old at time of application, and up to 58 years of age at time of maturity of the loanAny proprietor, partner, professional or director above 28 years but below 65 years at the time of the loan maturity.
Limited companies should have been in existence for at least 3 years
Income CriteriaGross annual income of at least Rs.4lakhsGross annual income of at least Rs.2.5lakhsFirm should have a minimum PAT (profit after tax) of Rs.2.5lakhsMinimum PAT (profit after tax) of Rs. 2.50 lakhs
Stability The total employment stability should be more than 2 years and current employment stability of minimum 1 yearBusiness stability should be more than 3 years

Other Papers and Documents – Income proof:

Salaried individuals :
Latest Salary Slip and 2 years Form 16/ Income tax returns.

Self-Employed individuals:
Income Tax Returns of 2 previous financial years.

Partnership Firms, Societies & Companies :
Income Tax returns of 2 previous financial years along with complete financial/audit report.

Documents supporting customer information :
Identity Proof, Signature Proof and Address Proofs as per Bank norms.