A car loan is available can be availed by a salaried or a self-employed individual with a steady source of income, having all the supporting proofs to back the same.
2. What is EMI on a car loan?
Installments paid by the borrower to the lending back to repay his/her loan are referred to as EMIs or Equated Monthly Installments. These payments include both the principal and interest, therefore EMI = Principal Amount + Interest on Principal Amount. EMI may be computed mathematically using the given equations: P x R x (1+R)N / [(1+R)N-1] where P = loan principal amount, R = interest rate, and N = number of months.
3. Is the EMI amount affected by the payback term?
Yes, the EMI is inversely proportional to the payback period opted for. The longer the loan tenure, the lesser will be the EMI and vice versa.
4. Can the EMI on a vehicle loan be modified in the future?
A vehicle loan EMI can be availed at either a fixed or a variable rate. If opted for a fixed rate, the EMI doesn’t vary, but in case of a variable rate, the EMI would fluctuate depending on the prevailing rate of interest.
5. What is a down payment on a vehicle loan?
Banks sanction loan based on several factors such as an individual’s credit rating and whether the car purchased is new or used, among others. A down payment is the balance amount (non-loan component) which an individual has to infuse to purchase a vehicle. The larger the down payment, the lesser will be the loan required, which will eventually result in lower EMIs, and vice versa.
6. What are the advantages of referring to an online Car Loan EMI Calculator?
An EMI calculator available on a particular bank’s websites or a trustworthy third-party website is a simple tool which displays immediate and precise findings, free of charge. Being highly customizable, it allows users the flexibility to modify their loan amount, tenure and rate of interest multiple times, to get a fair understanding the multiple permutations and combinations of the key financial components involved.
7. What documents are required to obtain a vehicle loan?
Banks require documents supporting the proof of identity, residence and income of a borrower: ● Identity proof: Aadhar Card/PAN Card/Driving License/Passport/ID Voter (any of the following) ● Address proof: Aadhar Card/Passport/Driving License/Ration Card/Utility Bills (any of the following) ● Income Proof: Salary Slips, Income Tax Returns (ITR), Form 16 for Salaried Individuals; ITR, Annual report Balance Sheet, Independently verified Income Statement, Audited P&L for Self Employed Individuals.
8. Is it possible to receive a car loan on a used car?
Yes. Many bank partners, including IndusInd, IDFC, ICICI, HDFC, and others, provide used automobile loans.
9. What requirements must I meet in order to obtain a vehicle loan for a used automobile?
A used automobile loan has the same qualifying requirements as a new car loan. Some banks may insist on inspecting the state of the used automobile before approving the loan.