Understanding the Basics of Car Loans in India

Purchasing a car is a significant milestone for many, but it often requires substantial financial resources. Car loans offer a practical solution, allowing you to spread the cost over time. Here’s a comprehensive guide to understanding car loans in India with Growth Money.

1. Types of Car Loans

Car loans are broadly classified into two types: new car loans and used car loans. New car loans are for purchasing brand-new vehicles, while used car loans cater to pre-owned cars. Growth Money offers both options through top banks, ensuring you find a loan that suits your needs.

2. Eligibility Criteria

Eligibility for a car loan typically depends on factors like age, income, employment status, and credit score. Most banks require applicants to be between 21 to 65 years old, with a stable income source. A good credit score enhances your chances of approval and can secure you better interest rates.

3. Loan Amount and Tenure

The loan amount you can borrow usually ranges from 80% to 100% of the car’s on-road price, depending on the lender and your eligibility. The repayment tenure for car loans typically varies from 1 to 7 years. Growth Money helps you choose the best loan amount and tenure that fits your budget.

4. Interest Rates

Interest rates on car loans can be either fixed or floating. Fixed interest rates remain constant throughout the loan tenure, while floating rates fluctuate based on market conditions. Compare rates from various lenders through Growth Money to find the most competitive option.

5. Documentation

Commonly required documents for car loan applications include identity proof, address proof, income proof (salary slips, bank statements, ITR), and details of the car you intend to purchase. Having these documents ready can expedite the loan approval process.

Conclusion

Understanding the basics of car loans can help you make informed decisions when financing your vehicle. Growth Money simplifies the process by offering tailored loan options from leading banks. Contact us today to explore your car loan options and drive home your dream car.