5 things to consider while applying for a Used Car Loan
We Indians are price-conscious. From a pen to an airplane, no matter what we are buying, we rarely go ahead without considering the best deal in the market. Little wonder then, that the used car sector (both organized and unorganized) is flourishing in the country. At 3.87 million vehicles a year, it is even bigger than the new car market of 3 million units.
Also, thanks to the increasing societal acceptance, the joys and emotions associated with buying a used car are the same as those with a new one. Hence, buying a used car is indeed a smart thing to do.
After you have decided on the payment mode & have zeroed on a loan, understanding loan eligibility criteria is the first step in your loan application process. The documentation and vehicle details are the prerequisites. If you plan to avail a loan for buying that used car, here are the things to consider:
- Zero-in on the car model
Do your research. Visit used car dealers, take test drives, speak to friends, read online reviews, interact with dealers, and consult like-minded individuals to get insights about the best model that fits your requirements (budget, usage, driving habits, driving conditions, etc.).
Learn about the technical and ownership aspects of owning a used car. Most organized used car dealers offer a complete package. Take your time and shop around for the best deals.
- Select a vehicle loan provider
Once you have zeroed-in on the vehicle, it's time to select your vehicle loan provider. Here again, search for the best used car loans online. Visit websites, read features and benefits, check for turn-around-time, loan value offered, research reviews on the service provider and then shortlist potential lenders.
You can also visit car dealerships, where representatives from various used car loan providers will be available to answer your questions. Don’t be in a hurry. Availing a car loan is a long-term commitment. Here are the five key factors to consider while doing so:
1. The interest rate
Getting the best interest deal for your used car loan is not easy. Do your homework on the various loan providers so that you find a deal that suits your needs. Remember, the rate of interest decides the amount you will have to repay, but do not let this be the only deciding factor. There are many other factors, once needs to consider, including credibility of the lender.
Nothing is more relaxing than a clearly laid out loan repayment schedule and the possibility to foreclose a loan with minimum charges. You can use this online EMI calculator to know the amount you will have to pay for each month. Try multiple combinations of Loan Amount, Rate of Interest, and Tenure, to arrive at the most suitable EMI.
The down payment that you make is an important part of the loan approval process. It reduces your loan amount and hence the EMIs. Some lenders offer loans for as much as 95% of the on-road price.
3. Loan process and processing fees
A car loan provider charges a fee for processing your application and doing the paperwork. This amount depends on the loan amount, the tenure, and the down payment. Seek information about these charges and read the fine print to ensure that you understand all the charges.
4. Re-payment scheme
The re-payment scheme is an important consideration for any loan. When you choose to deal with an established NBFS, you are assured peace of mind and ensure that your EMIs and other terms are flexible for easy and hassle-free payment.
To know more and to avail a used car loan, contact Reliance Commercial Finance. Ask us about great deals on used car loans.