Cheapest Car Loans:Buying a car is a short term financial goal. For example, one has to save money in advance so that funds can be arranged. The festive season has almost started in the country. In such a situation, many people must be planning to buy a car. If you are also one of them but do not have enough funds to buy a new car, then you can take a loan. Almost every bank in the country provides car loans to buy a new car. With its help, your dream can be easily fulfilled. Most people in India resort to this option to buy a car. However, a small part of the car’s price has to be paid as down payment. To buy a car, some banks finance 100 percent of the car’s price to the people. Who can get a car loan? First of all, let’s know about it.
Who can get a car loan
resident of india
who is above 18 years of age
People with better credit score can easily get loan
Salaried job professional, professional or businessman who is earning at least 25,000 per month. However, these conditions may vary in different banks.
Available for Aadhaar OTP based e-KYC or Video KYC during loan application and Video KYC process
Many banks take a part of the car’s price as down payment in addition to fulfilling all the criteria for auto loan and submitting the required documents. The down payment can also be a pre-determined portion as per the loan eligibility. If you do not meet the eligibility requirements of the bank, you may also have to provide information about your guarantor.
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Where can you get the cheapest car loan?
The monthly EMI or installment on a car loan depends on the interest rate. And it can be different in different banks. If your credit score is good, then you can get a car loan at a lower interest rate. Before selecting a bank for a loan, you should compare the loan interest rates offered by different banks for buying a car. By doing this you can get a better car loan. One more important thing should be remembered, the lower the loan interest rate, the lower will be the monthly EMI.
Where can you get the cheapest car loan
Most banks offer loans at concessional rates to working professionals and those with a good credit score. If we talk about car loans at the cheapest interest rate, then Canara Bank, Union Bank and Bank of Maharashtra offer car loans starting at 8.70 percent. The country’s largest government bank SBI is offering car loans to its customers at an initial rate of 9.05 percent and the bank is not charging any processing fee for this. Here you can check the detailed list of interest rates, monthly EMI and processing fees of various banks for car loans.
| Loan interest rates and processing fees for purchasing a new car | |||
| Name of Lender | Interest rate (%) | EMI (Rs.) Loan amount- 5 lakh Tenure- 5 years | processing fee (% 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% discount on processing fees for PSB Apna Vahan Sugam. | |||
| Rates and charges as of 4th 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 till September 4. 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.)
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Car buyers can get loans at cheaper rates if they have a better credit score. Apart from this, corporate salary account holders and customers who have previously taken a housing loan can also get a discount of 0.25 percent in interest. Punjab and Sindh Bank PSB is giving up to 50% discount on processing fees under its Vahan Sugam scheme. In such a situation, customers who are thinking of arranging funds for buying a new car through a loan are advised to select the concerned bank after considering all the aspects given in the list.
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.)
