Car loan


What is Car Loans?

A car loan is pretty much what you think it is: It is a personal loan, the proceeds of which are used to purchase an automobile. More specifically, a lender loans the borrower (you) the cash it takes to purchase a vehicle. In return, the borrower agrees to pay back the lender the amount of the loan plus interest, usually in monthly payments, until the amount owed is fully paid off. Pretty simple, so far.

How to apply for Car Loans

Apply Online

Fill simple application form

We process

Your application for loan


We get the best rates for you


Loan is approved and amount credited

Car Loan Interest Rates

Car Loan Details
Interest Rate (Monthly reducing balance) 8.60% onwards
Processing Fees Varies with bank
Loan Tenure 1 year to 7 years
Pre-closure Charges Varies with bank
Guarantor Requirement Varies with bank

Features and Benefits of Car Loan

When it comes to car loans in India, in general, the following features and benefits are offered. Note that, the following is a generalized look at the advantages offered by car loans. Individually, car loan lenders may have highly customized and specialized offerings for their customer base.

  • A car loan helps you purchase a better car than the one that you can buy with your savings.
  • It allows you to quickly purchase a vehicle-spend too much time to arrange money through time ' without examining the concept of saving it.
  • It helps you manage the cost of purchasing new car by spreading it across a long period of time. Thus, it keeps you in control of your expenses and makes it much easier to pay for the car.
  • The highest car loan offerings in India are safe loans. This means that the security for the car loan Acts as a collateral. If you default on repayment, you stand to lose the car, plus your credit score is damaged. However, you have a measure of control over the action-just be careful of not defaulting on your car loan EMI.
  • Buying a car loan is usually simpler when compared to the Peca loan products. Individuals with a slightly tasteless credit score can also expect a purchase. However, this option differs from bank to bank.
  • When it comes to paying through an EMI, car loans in India often use the option of fixed interest rates. This means, you have always assured a certain amount that needs to be repaid on a monthly basis.
  • The actual maximum loan amount depends on the vehicle to be purchased and varies from bank to bank. However, most of the on-road price of this vehicle is 100%. The repayment period usually spans from 5-10 years and provides a different interest scales for the different tenure slabs.
  • Most importantly, a car loan helps you buy your dream car. Being completely transport option aside, the car acts as a confidence booster and means to earn your hard-earned financial independence.

Car Loan - Checklist to Follow While Applying for it

Steps Requirement Inference.
Submit Income Proof Bank Statement (last 6 months)
Pay-Slips (last 3 months)
IT- Returns (last 2 years)
Lender wants to establish your ability to repay the borrowed amount.
Submit Proof of Address and Identity PAN Card, Voter’s ID, Aadhaar Card, Passport, etc. Lender wants to establish your nationality, identity and permanent address.
Credit History PAN Card Lender wants to check your past credit records and establish if you can be trusted to make regular repayments.
Information About Vehicle Sales Receipts from the Showroom from wherein the Vehicle was Purchased. Lender must confirm that the deal was affected as intended.
Proof of Insurance and Driving License Copies of the Vehicle’s Motor Insurance and your Driving License. Lender must establish that all laws and protocols are followed with regards to the purchased vehicle.

Car Loan - Why Should You Opt for it?

There are two different reasons and advantages of choosing car loans in India. First, cars are expensive. It is an expensive investment which is generally not completely affordable in the case of a typical middle class Indian. While his savings may account for a large chunk of the vehicle’s purchase amount, the aforementioned purchase should be covered by the amount provided by the car loan as a significant portion. Secondly, heavy purchases (such as buying a car) with liquid cash can get you on the radar of the IT department, in addition, you lose the chance to subscribe to a car loan and build important credit history by following the religious repayment cycle. Credit history thus made, will help you purchase more credit in the future. Therefore, car loan in India is the most secure and safest way to buy your ideal vehicle.

Choosing the Right Car Loan

When it comes to selecting the car loan that works best for you, some fundamentals will come in handy. The following table explains the do’s and don’ts when choosing the right car loan:

Do’s Dont’s
Compare – Check out the maximum number of options available to you. Not all car loans are created equally – and finding the best loan could involve some work. can help you here by helping you check out and compare between the various car loan and used car loan options available to you. Eligibility – Do not apply for a loan amount that exceeds your eligibility, as this will result in the rejection of your loan application.
What’s the Interest? – The applicable interest rate is potentially the biggest factor when it comes to choosing the right car loan. Not surprisingly, the lower the interest rate, the better. Multiple Applications – Do not apply with multiple banks as this will have a negative impact on your credit score.
Keep it Simple – Pay heed to your financial limitations and choose a car model that perfectly suits your budget. This will imply that your car loan is in line with your set requirements. Don’t fall prey to up-selling tricks at the car showroom. Relying on the Dealership – The loan that the dealer offers may not have the best interest rate. So, check the other options.
Hidden Fees and Charges – Sometimes what appears as obvious will have a hidden component. Be completely aware of the hidden fees and charges concerning the car loan, as also be cautious of time bound incentives and packages- they will expire soon and you may be left with a lesser deal than you hoped for.
Insurance – Decide on the amount of insurance required. Choose the coverage and cost carefully after evaluating all options.


This factor is different from bank to bank. While some banks give the full 100% of the on-road price of the vehicle, such banks offer up to 90% of the ‘ on-road ‘ price of the vehicle. Normally, however, the minimum loan amount would be equal to one lakh rupees.

Yes, you can save on full car loan prepayment and significant interest payments in the future. However, most banks will allow the pre-payment option after being ready for 6 months on your loan tenure. In addition, you will be expected to pay a small fee as a prepayment penalty that will depend on the amount of the remaining loan.

Almost all small to medium-sized cars, sports utility vehicles (SUVs) and multi utility Vehicles (MUV) come under the purview of car loans available in India, unless specified. However, as mentioned, refer to the loan brochure for the exception of this rule.

Almost all car loan products available in India are safe loans, which serve as customary security as well as the vehicle purchased. Most lenders in India won’t insist on any guarantor, however, if your annual income does not match the anticipated requirement, you will be able to co-applicant and/or Or a guarantor can be expected to sign up.

Repayment tenures usually range from 12 months to 84 months (1-7 years).