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Car Financing in UAE

Steps and documents required to get a car finance in UAE

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Car Financing in UAE

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  1. Car Financing In UAE

  2. Introduction • However, when it comes to buying a car, local auto loan interest rates are relatively low at 2 to 4 per cent versus more than 5 per cent in other markets. • The first thing they should be aware of is, In UAE banks have a minimum eligibility criteria for securing a car loan. • Factors you should consider when signing up for car finance in UAE.

  3. Tenure • Al most all loans have a tenure of up to a maximum of 60 months. • Usually it will be shorter for used cars. • So an old model you today buy could only secure finance for under two years.

  4. Down Payment • You will get up to 80% percent finance for your new car only finance 80 per cent and you should pay 20% percent down payment. • The down payment is generally paid directly to the bank, which then in turn settles the full value of the used car with its owner. • If you are lucky enough you may get 0% down payment at the time of promotion and campaigns of dealers.

  5. Minimum Loan Value • Minimum finance value differs from bank to bank. With the help of comparison website you can easily compare car loan in uae.

  6. Monthly Payments • Your monthly payments will be half of your salary so that the resulting Equal Monthly Instalments (EMI) of your used car loan cannot be greater than half your salary minus existing liabilities, which includes credit cards. • If your salary is 12000 a month, your car loan instalments will not be greater than 6000 in a month. • If you are already having another loan, then that will be counted as your existing liabilities.

  7. The Car You Can Afford • To help you calculate how much you can borrow, start off with half of your monthly salary and subtract any existing monthly instalments that you already pay. • Then subtract 5 per cent of all your credit card limits. This will tell you the maximum monthly car loan instalment you are eligible for. • Then multiply this by 60 months, with the resulting figure the approximate car value you can go for. • Reduce that number by 3 to 4 per cent to account for the interest your lender bank will charge you. • Now that you know the numbers, you can actually start shopping for a car.

  8. The Documents You Need For A Car Loan • To apply for the loan, you must submit three months’ bank statements, a salary certificate and a valuation certificate for the car you want to purchase. • You must also be a UAE resident, have a valid UAE driving license and have a clean financial record, backed up by a salary certificate

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