Cheapest Car Loans: After buying a house, most people dream of buying a car. Many of them plan in advance to buy a car and save money. In this journey, if some money falls short, people take the help of car loan to fulfill their dream. If something similar happens with you too and you are looking for a car loan to fulfill your dream of buying a car in this festive season, then for your convenience, a list of all the banks is given here.
Before applying for a loan from a bank to buy a car, it is important to compare the car loan schemes and interest rates charged by various banks. By doing this, you may get the opportunity to choose a cheaper car loan option. Apart from this, car buyers should thoroughly understand the processing fees of bank car loans, necessary documents and the terms and conditions of the loan.
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Which bank is offering the cheapest car loan this festive season? Check the list here.
| Loan and processing charges for purchasing a new car | |||
| Name of the Bank | Interest Rate (%) | What will be the EMI on a car loan of up to Rs 5 lakh with a tenure of 5 years | Processing Fees (% of loan amount) |
| Union Bank Of India | 8.70 – 10.45 | 10,307 – 10,735 | ₹ 1,000 |
| Punjab National Bank | 8.75 – 10.60 | 10,319 – 10,772 | 0.25% (Rs. 1,000 – Rs. 1,500) |
| Bank Of Baroda | 8.95 – 12.70 | 10,367 – 11,300 | Upto Rs 2,000 |
| Canara Bank | 8.70 – 12.70 | 10,307 – 11,300 | 0.25% (Maximum Rs 2,500) |
| Bank Of India | 8.85 – 12.10 | 10,343 – 11,148 | 0.25% (Rs. 1,000 – Rs. 5,000) |
| UCO Bank | 8.45 – 10.55 | 10,246 – 10,759 | Nil |
| State Bank Of India | 9.05-10.10 | 10,391-10,648 | NIL |
| IDBI Bank | 8.80 – 9.65 | 10,331 – 10,294 | ₹ 2,500 |
| Maharashtra Bank* | 8.70 – 13.00 | 10,307 – 11,377 | 0.25% (Rs. 1,000 – Rs. 15,000) |
| Indian Overseas Bank** | 8.85 – 12.00 | 10,343 – 11,122 | 0.50% (Rs 500 – Rs 5,000) |
| ICICI Bank | 9.10 onwards | 10,403 onwards | Up to 2% |
| HDFC Bank | 9.20 onwards | 10,428 onwards | Up to 0.50% (Rs 3,500 – Rs 8,000) |
| Karnataka Bank | 8.88 – 11.37 | 10,350 – 10,964 | 0.60% (Rs 3,000 – Rs 11,000) |
| Federal Bank | 8.85 onwards | 10,343 onwards | ₹2,000 – ₹4,500 |
| Punjab and Sind Bank*** | 8.85 – 10.25 | 10,343 – 10,685 | 0.25% (Rs. 1,000 – Rs. 15,000) |
| South Indian Bank | 8.75 onwards | 10,319 onwards | 0.75% (Max: Rs. 10,000) |
| IDFC First Bank | 9.00 onwards | 10,379 onwards | Upto Rs 10,000 |
| City Union Bank | 9.90-11.50 | 10,599-10,996 | 1.25% (Min: Rs 1,000) |
| ,0.25% concession in interest rate for existing housing loan borrowers and corporate salary account holders. | |||
| ,Car buyers with a credit score of over 800 can avail a discount of 0.50% on interest rates, while those with a credit score of 750-799 can avail a discount of 0.25% on car loan interest rates. | |||
| ,Up to 50% concession in processing fees on car loans under PSB Apna Vahan Sugam Scheme. | |||
| Rates and charges as of 11th September 2024 | |||
| Source: Paisabazaar.com | |||
,Note: The list of car loan interest rates has been prepared by Paisa Bazaar.com. The details of all the banks included in the list are as of 11 September. Before deciding to take a car loan, confirm the exact information related to the interest rate from the official website and branch of the bank because vehicle companies keep changing the prices of vehicles from time to time, due to which banks also keep changing the rates of car loans.)
These banks have zero processing fees on car loans
Most banks charge processing fees for car loans. However, some banks charge zero. That is, there is no processing fee. SBI and UCO Bank included in the list are offering car loans to people at zero processing fees. Union Bank of India is charging Rs 1000, IDBI Bank is charging Rs 2500 and banks like Bank of Baroda, Federal Bank, IDFC First Bank are charging from Rs 2000 to Rs 10000. Many banks like Canara Bank, Central Bank of India, Bank of India are charging processing charges up to 1.25% of the loan amount.
Also read: Best FD rates: These 5 banks are giving the highest returns on FD, check details before investing
By keeping these things in mind, you can save money
Keep in mind that the loan interest rate depends on the applicant’s credit score. If your credit score is above 750, i.e. better, then you are more likely to get a loan at a lower interest rate.
Some banks offer a rebate of 0.25% in car loan interest rates to existing housing loan customers and corporate salary account holders.
Punjab & Sind Bank is offering up to 50% discount on processing fees to car buyers under the PSB Apna Vahan Sugam scheme.
Documents required for car loan application
Bank account statement
2 passport size photographs
Identity Proof (Passport, PAN Card, Voter IT Card or Driving License etc.)
Address Proof (Ration Card, Driving License, Passport, Telephone Bill, Electricity Bill or Life Insurance Policy etc.)
Salary slip, Form 16
In case of non-salaried/professional/business person, audited balance sheet, two years profit and loss statement, shop and establishment certificate/sales tax certificate/SSI registered certificate/copy of partnership
In case of people involved in agriculture or related activities, Khasra/Chitta (showing cropping pattern)-Patta/Khatauni (showing land holding) with photo. All land should be on freehold basis and ownership proof should be in the name of the loan taker.
(Note: All the information has been taken from the website of the respective bank. All the banks demand details like address proof, ID proof, salary slip i.e. income proof, which are included in the list of required documents.)
