Almost everyone of us has a dream of owning a vehicle. It does not only serve as a mode of transportation for us, but also acts as a fixed asset. Nowadays, having a vehicle has become more of a necessity rather than a luxury. It provides many professionals a way to travel long distances from their houses, to the place where they work. In such situations, a car becomes a time-saving and easy mode of transport. Buying a new machine or even a used vehicle can be a little difficult but the solution is easy to find. One can simply search for the best loans and fulfil the dream of having a shiny new vehicle.
The car loan interest rates vary according to the credit score of the customer and the tenure of the loan. Generally, there are two different means through which interests can be calculated. They are fixed and floating rates. However, in order to find the best possible deal, a little research is a must. These loans are considered to be secured. Therefore, lenders are able to take more risks while offering services to the customer. Mentioned below are certain factors that you must keep in mind before opting for the same:
Income of the customer: In most cases, salaried people can be granted a loan which is 3 times of their annual income. While self-employed professionals can be provided with loans up to 5-6 times their annual income. Market Interest rates and other charges: The availability of a loan depends on the market demand for the same. It can also vary according to processing fees, charges etc. Prices of the vehicle: It is important for the lender to check whether the price of the car is covered with the loan or not. 80-90% of the market price is usually covered by the loan. However, one must calculate the entire amount including interest in order to check the eligibility.
Many banks and financial institutions in India have been offering different auto loantypes to meet the needs of a varied customer base. If the buyer is unable to repay the loan amount, the lender can seize the vehicle. If one needs to search for the best loan available, it is best to look at various offers and list the benefits and limitations of each. After carrying out these steps, one can look out for the options available in the market. Loans to purchase a new vehicle: This loan is designed specifically for people who want to buy a new car. They cover a wide range of vehicles and offer greater lending amounts than the others.
Pre-Owned Car Loans: A pre-owned or used vehicle can prove to be a more affordable option for many people, who are not able to buy a new one. There are limits on the types of vehicles one can buy. Loan against Car- Already owned vehicles can be deposited as a security to borrow money. The lender can claim the car if you are not able to pay back the loan. Thus, these loans have provided a gateway to people who dream of owning a vehicle in India and different parts of the world. With the commercial banks providing their own interest rates and schemes, they prove to be beneficial for all.
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