Are you planning to buy a car in this festival season Know the details here!

During the festival season, there are lots of exciting offers around. Many people want to buy big things, like new cars. Banks are giving special deals on car loans, making it easier and cheaper to buy a car. But before you get a car loan, it's important to know all the details so you can make a smart choice.

Why Festival Season is the Best Time for a Car Loan?

The festival season is a great time to buy big things like cars, and banks offer many benefits during this time. Here’s why you should consider taking a car loan now:

1. Lower Interest Rates: Interest rates on car loans are usually lower during the festival season. Banks want more customers, so they offer special deals like reduced rates and no processing fees.

2. Festive Car Discounts: Car makers often have special discounts and bonuses during this time. These offers can lower the price of the car and reduce the loan amount you need.

3. Quick Approvals: To keep up with the festive rush, banks often process loans faster with fewer documents needed. You can get your car loan approved in just a few hours or days, so you don’t miss out on great deals.

Things to Consider Before Taking a Car Loan

While the festival season has many benefits for getting a car loan, it's important to make smart choices. Here are some key things to think about before you apply:

1. Loan Amount and Down Payment: How much you can borrow depends on your income, credit score, and the car's price. Lenders usually offer 80% to 90% of the car's price as a loan. You’ll need to pay the rest as a down payment. The more you pay upfront, the less you borrow, which means lower monthly payments (EMIs).

2. Interest Rate: The interest rate affects how much your loan will cost in total. Even a small change in the rate can impact your EMI. Compare rates from different lenders to find the best deal.

3. Tenure: The loan tenure is how long you'll take to pay back the loan. Longer tenures mean lower EMIs, but you'll pay more interest overall. Choose a tenure that fits your budget while keeping costs reasonable.

4. Processing Fees and Other Charges: Lenders may charge processing fees, usually between 0.5% and 2% of the loan amount. Some may also charge fees if you pay off the loan early. Know these costs to avoid surprises later.

Eligibility Criteria for a Car Loan

Before applying for a car loan, it’s very important to ensure that you meet the eligibility criteria. These are the below most important criteria:

1. Age: You need to be at least 21 years old and no older than 65 when the loan ends.

2. Income: Lenders want to see that you have a steady income. If you’re salaried, you should earn at least ₹20,000 to ₹25,000 a month. If you’re self-employed, you need to show that your business income is stable.

3. Employment: If you work for a company, you should have been in your current job for at least one year and have two years of total work experience. Self-employed people should have been in business for at least three years.

4. Credit Score: Lenders prefer a credit score of 750 or higher. Some may approve loans with lower scores, but the interest rates might be higher.

5. Documentation: When applying for a car loan, you’ll need to provide:

• Identity proof (like Aadhaar, PAN, or Passport)

• Address proof (like utility bills or rental agreements)

• Income proof (like salary slips, bank statements, or tax returns)

• Employment proof (like a job offer letter or employment certificate)

Understanding the EMI Breakdown

Your EMI has two parts: paying back the principal and paying interest. In the beginning, most of your EMI goes to interest. Over time, more of your payment goes towards the principal, and less goes to interest.

For example, if you take a car loan of ₹5,00,000 at an interest rate of 9% for 5 years, here’s how the EMI is calculated:

Calculate your EMI for a car loan here

Conclusion

The festival season is a great time to get a car loan because of low interest rates, special discounts, and flexible repayment options. However, it's important to research and understand key details like loan amounts, interest rates, and repayment terms. By making smart choices based on your finances, you can make the most of this festive time. Enjoy the thrill of starting something new and the journey of owning your dream car, all while keeping your finances stable. Happy car shopping!

How can EazyBankLoan help you in taking a loan?

We understand that getting a loan can be very stressful with confusing documents, unclear communication, and various other challenges. That is why we take care of your loan application process, saving you time and hassle by handling the paperwork and communicating with the loan providers.

Check the details here at EazyBankLoan

Need help? Reach out at support@eazybankloan.com

Frequently Asked Questions (FAQs)

1. What are the benefits of taking a car loan during the festival season?

   • The festival season often offers lower interest rates, special discounts from car manufacturers, and flexible repayment options.

2. What factors determine my eligibility for a car loan?

   • Eligibility is based on your age, income, employment stability, credit score, and the documentation you provide.

3. How much of the car's price can I borrow?

   • Lenders typically finance 80% to 90% of the car's on-road price, requiring you to pay the rest as a down payment.

4. What is the impact of a higher down payment on my loan?

   • A larger down payment reduces the loan amount, which can lower your monthly EMI.