What documents do you need for a car loan

The documentation process is important for lenders because it helps them:

1. Check your identity, income, and financial situation.
2. See if you can repay the loan.
3. Decide how much money you can borrow and what interest rate you will get.

If you provide complete and accurate documents, it can make your loan approval faster and keep the process running smoothly.

Types of Documents Required for Car Loans

Vario lenders have various documents needed but let’s understand the overall documents needed for every lender:

General documents such as:

• Application form

• Passport sized photographs

• KYC details such as Aadhar, PAN, Voter, Passport etc.

Let’s break by Salaried Employed and Self-employed Individuals:

For salaried individuals:

• Most recent two months' salary slips to demonstrate your income

• The latest Form 16 or the most recent Income Tax Return (ITR), which serves as evidence that the employer has submitted the deducted TDS to the appropriate authorities

• Bank statement showing transactions for the past three months

• Proof of age, which can be furnished as a PAN Card, driver's license, passport, or birth certificate

• Specific forms to verify your signature

• Permanent Driving License

• Voters ID Card

• Aadhar Card

• PAN Card

• Other documents needed by lenders

Self-employed professionals:

• Proof of address

• Copy of your business registration, GST or MSME certificate

• Bank statement for the last 3 months

• IT returns for the past 2 years

• Balance sheet, profit, and loss statement, or any proof of income

• Udyam Registration for MSME

• KYC documents

• Other documents needed by lenders

More or less in summary, you should have the following documents:

1.Proof of Identity

• Aadhaar Card

• Passport

• Voter ID Card

• Driving License

• PAN Card

2. Proof of Address

• Utility Bills (Electricity, Water, or Gas bills, typically not older than 3 months)

• Rental Agreement or Lease Agreement

• Passport

• Aadhaar Card (if it includes your address)

• Voter ID Card

3. Proof of Income

For Salaried Employees:

• Salary Slips: Usually the last 3 months.

• Form 16: This shows your income for the year and tax deductions.

• Employment Letter: Some lenders ask for this, especially if you've recently changed jobs.

For Self-Employed Individuals:

1. Income Tax Returns (ITR): Typically for the last 2-3 years.

2. Profit and Loss Statement: This is crucial for self-employed individuals or business owners.

3. Business Registration Certificate: Proof of your business registration may also be required.

4. Bank Statements

Bank Statements for Salaried Individuals:

• Last 6 months of bank statements are generally required.

Bank Statements for Self-Employed Individuals:

• Bank statements from the last 12 months might be required.

4. Proof of Age

• Birth Certificate

• Aadhaar Card

• PAN Card

• Passport

5. Employment Verification

• Employment Certificate from your current employer.

• Letter of Appointment if you’ve recently joined a new job.

6. Vehicle Documents

• Proforma Invoice: This document from the dealership provides details of the car you plan to purchase, including the price, model, and variant.

• Photographs (2-3)

• Additional Documents as required by lenders

Conclusion

Applying for a car loan doesn’t have to be stressful. If you prepare all the needed documents, you can avoid delays and make the loan approval process easier. Whether you have a job, run your own business, or are an NRI, this checklist will help you know what you need.

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 happens if I submit incorrect or incomplete documents?

• Submitting incorrect or incomplete documents can lead to delays in your loan approval process. In some cases, it may even result in the rejection of your loan application.

2. How many months of bank statements are required?

• Most lenders ask for 6 months of bank statements, though some might

3. Why do lenders ask for income proof?

• Lenders require income proof to assess your ability to repay the loan. It helps them evaluate your financial stability and creditworthiness.

4. Can I use an Aadhar card as identity proof for a car loan?

• Yes, you can use an Aadhar card, but only if submitted voluntarily and backed by an Aadhar consent letter. Certain details, like the first 8 digits of the number, must be redacted.

5. How recent do my financial documents need to be?

• Generally, your salary slips should be from the last two months, and your bank statement should cover the past three months. Aadhar or e-Aadhar should not be older than 30 days from the date of application.