In this era of human evolution, dreams have no boundaries. It is a dream for every man to own their own car, but spending a hefty amount of money at once doesn’t seem to be a good idea for all. We all have our financial commitments and with the rising inflation rates, it irks to spend the hard earned money on desires but not necessities.
However, to ease out the burden, financial institutions and banks in extend instant approval car loans at an affordable rate of interest with easy equal monthly instalments without disturbing anyone’s budget.
Required documents for car loans
Every individual who is opting to borrow a loan has should have all these documents to secure their loan.
For Salaried Employees
- i) Identification proof
- ii) Income proof: Salary slips for 3 months from the current employer, credit card statements from the bank, etc.
iii) Residential proof: Electricity bills, utility bills, etc
- iv) Age proof
- iv) Photographs
- vi) Car documents
ii)Income Proof of Self – Employment: Audited finance report for the last 3 years, recent bank statement for 6 months
iii) Proof of Business – Certificate of Practice, Shop Act Licens,
iii) Residential proof: Electricity bills, passport, utility bills
- iv) Duly filled in application form along with recent passport size photograph.
Things to know before getting instant approval car loans
In car loans, the lender avails the loan on the basis of either ‘net monthly income’ or on the ‘On-Road Vehicle’ price. Another factor they consider is the age of the borrower. Some banks offer 80-90% financing and some banks even offer 100 % financing as well.
Interest rate charged
Banks and financial institutions charge the interest rate as the Marginal Cost of Funds based Lending Rate (MCLR) plus an additional spread. It depends on the bank sanctioning the loan. Higher the rate of interest higher will be the EMI and vice-versa.
Lenders generally offer an adjustable repayment period generally stretching between 1 and 7 years. The term mostly depends on the amoun of sanctioned. One can easily choose the repayment period according to their convenience. Higher the loan tenure lesser the EMI amount.
The hypothecation letter is part of the car registration papers. Hypothecation gives the right to the lender( bank or financial institutions) to seize the asset in case the EMI’s are not met on time. Once you finish paying all the EMI’s make sure the change the name of the owner in the papers.
Sanctioning car loans are much easier than a home loan. Also, there is no additional security asked for as against in the case of the former. The loan itself is secured against the car. So if you are planning to buy a car, think no more and apply for prequalified car loans.