Why choose Soni Money?

Our mission is to deliver reliable, latest news and opinions.

Opting for Used Car Loan at Mumbai

If you’re getting to purchase a car of your own but don’t have enough funds, banks and financial institutions allow you to borrow funds at interest. Be it a fresh hatchback or a used sedan, You have to purchase the car of your dream with the assistance of the proper car loan.
There are three sorts of car loans available within the market-

New car loan, Used car loan, and a Loan against Cara replacement car loan.

Banks and lenders also offer Used Car Loans to people getting to buy a used or a used car at a rather higher rate of interest. Loans against pre-owned cars are available for pre-owned cars which aren’t been used for five years. In cases of emergency, you have to pledge your used car as collateral for a loan to shop for a replacement ca this is often referred to as a Loan against Car.

Buying a car is a crucial decision. Before you began to shop for a car, understand your needs. You ought to buy a car that supported your needs be it a new car or a used car. Is it for routine trips to figure, is it for creating long trips on vacations, is that the car for dropping your children at school? supported your need, You have to choose a car that’s within your budget and is applicable for a loan.

If you’ve got set your eye on a used car and need to get it, banks and financial institutions will assist you to make the acquisition. With a Used car loan, You have to rise to 90 percent of the car’s valuation as a loan. Funding is out there for the purchase of cars which aren’t been used than five years

The rate of interest charged on the purchase of pre-owned cars is slightly above the loan on new cars. Banks and lenders charge anywhere between 8 to 16 percent once a year for Used Car Loans. The best-used car loan rates are available at various branches at Mumbai. You have to repay the loan within a period of up to eight years. At the time of maturity of the loan, the car must be younger than 10 years.

Basic Eligibility criteria to be satisfied to obtain a used car loan at Mumbai

Every bank and financial organization offering car loans feature a different set of eligibility criteria. However, there are a couple of rules that apply across all banks for a car loan.

• You’ve got to be a minimum of 18 years old.
• If you’re a salaried employee, you have to apply for a car loan until you’re 60 years old.
• If you’re self-employed or run a business, you have to apply for a car loan for up to 65 years.
• To be eligible to apply for a car loan, you want to earn a minimum of Rs 10,000 a month.

Financiers and banks seek stability within the applicant and hence invite a gift address where you’ve got stayed for a minimum of a year. you ought to even have a delegated parking lot for the car at your home of residence. You have to apply for loans for a car of an approved make by an approved manufacturer. You also need an honest credit score to be eligible to use for a car loan. If you’ve got a credit score of above 750, you’re eligible for a car loan from banks and financiers.

Banks and financial institutions provide financial help to individuals getting to buy cars. Each bank and financial organization have different features within the loans they provide.

Here are a number of the essential features of a Used Car Loan:

Loan Amount for a used car loan at Mumbai: The quantity of your loan will vary from bank to bank, counting on your credit score and eligibility. It also depends on what proportion deposit you’re ready to pay. Usually, banks offer up to 85 to 100 percent of the on-road or ex-showroom prices of the car.

Loan tenure used car loan at Mumbai: You have to prefer to pay back your loan within a year or anytime within eight years. The shorter the tenure, the upper are going to be EMI to be paid by you each month.

EMI for a used car loan at Mumbai: This is often the Equal Monthly Installments that you simply need to pay to the bank for the tenure that you’ve got taken the loan. this is often inclusive of your balance amount, the interest charged, and the processing fee. most banks and financial institutions offer free EMI calculator options wherein You have to estimate your EMI if you’re taking a loan.

Interest Rate used car loan at Mumbai: This is often the interest you pay on the principal amount that you simply have borrowed. The interest rates vary from bank to bank. Usually, the rate of interest is anywhere between 8 to 16 percent once a year, counting on the type of loan you’ve got taken. The interest rates also are different for brand spanking new car loans and used car loans also as loans against cars. Compare the interest rates properly before choosing your loan.

Processing fee used car loan at Mumbai: Every bank charges a nominal fee as a processing fee for processing your application. it’s usually a little percentage of the principal amount. In some cases, banks may waiver this processing fee.

Pre-closure of a used car loan at Mumbai: Banks allow you to shut your loan account before your tenure period is over. This facility is out there only you’ve got paid 12 EMIs on time. You have to pay the complete outstanding and close your loan account after paying a penalty charged by the bank for early closure called the pre-closure fee.

Prepayment used car loan at Mumbai: Banks also allow you to pay an outsized part of your outstanding in one follow you’ve got paid 12 EMIs. This, too, will attract a penalty by the bank called the prepayment fee.

New car loan vs Used car loan

There is tons of difference between a replacement car loan and a used car loan. Banks make different offers on both these loans. Here we tell you the essential differences between a replacement car loan and a used car loan.

1. Purpose: The New car loan is out there to anybody getting to buy an unused car directly from the showroom. On the opposite hand, the Used car loan provides financial assistance to anybody getting to buy a used car at Mumbai.
2. Interest rates: The interest rates offered by banks and financial institutions for brand spanking new Car Loans and Used Car Loans are different. While the rate of interest of a replacement car loan ranges from 9 to 14 percent, the rate of interest for Used Car Loans is slightly higher and ranges from 12 to 18 percent once a year.
3. Risk factor: Most banks and lenders find that giving out a loan on a fresh car is a smaller amount risky than that on a used car. This risk factor drives up the interest rates for Used Car Loans.
4. Loan amount: The loan amount for fresh cars is far above that for used cars. this is often because the ex-showroom or on-road rice of the new car is far above a used car. just in case of a replacement car loan, You have to get the maximum amount like 85 to 100 percent of the ex-showroom price of the car. just in the case of used cars, the loan amount is between 70 to 80 percent of the worth.
5. Tenure: New Car Loans are available for extended durations, meaning the loan is often paid back over an extended duration of your time. However, just in the case of a used car loan, the tenure is anywhere between three to 5 years only.
6. EMI: The EMIs to be purchased a used car loan is far above the EMIs to be purchased a replacement car. are often “>this is often because the new car loans can be repaid over longer tenures but the used car loans need to be repaid sooner.

 

The application process to apply for a used car loan

You can apply for a car online directly through the bank’s website. You have to use a third-party website where you compare the loans offered by different banks and apply through the third-party website. You have to got to submit your income proof which might be within the sort of three months’ salary slip, IT returns, and bank statements. You have to even be required to submit age proof, identity proof, and address proof. Your applications are going to be sent to the bank. The bank will verify the small print then approve or disapprove your request.

Time taken by banks accept used car loan applications at Mumbai

As a part of your application, you would like to submit income proof, age proof, identity proof, and address proof. The bank will verify your details and check if you’re eligible for the loan. If approved, the loan amount is instantly transferred to the applicant’s account.

Used Car Loans –Benefits

The main benefits of a used car loan are mentioned below:

• Less Loan Amount.
• Long repayment tenure.
• Up to 100% financing is provided by certain banks and NBFCs.
• Online Process
• The insurance costs and depreciation rates are lower in comparison to a new
• Minimum paperwork.
• Certain banks and NBFCs offer flexible repayment terms.

Eligibility Criteria to meet while applying for a used car loan

The eligibility criteria that has got to be met for salaried employees and self-employed individuals will vary and are mentioned below:

Salaried Employees
• Age Limit: 21-65 years
• Income: a minimum of Rs.15,000 per month
• Income Status: you want to be working within the current organization for a minimum of a year

Self-employed Individuals
• Age Limit: 25-65 years
• Income: Must make a profit of a minimum of Rs.1.5 lakh during a year
• Income Status: Must be within the same line of business for a minimum of 3 years

Documents Required while applying for used car loans at Mumbai
The list of documents that have got to be submitted when applying for a used car loan is mentioned below:

• Application form
• Passport-size photographs
• Car valuation report
• Identity Proof: Any of the below-mentioned documents are often submitted as proof of identity:
  • Aadhaar Card
  • Passport
  • Driving License
  • Voter’s ID
  • PAN Card
  • Address Proof: Any of the below-mentioned documents are often submitted as proof of address:
  • Voter’s ID
  • LIC Policy
  • Electricity Bill
  • Aadhaar Card
  • Driving License
  • Ration Card
  • Passport
• Income Proof: The below-mentioned documents must be submitted as proof of income:
  • Profit and loss account
  • Balance sheet
  • Audit sheet
  • Form 16
  • Salary slip
  • Bank statements

Offline Application for a used car loan at Mumbai:

• Visit the bank branch or NBFC office where you’d wish to avail a loan.
  • Fill the appliance form.
  • Submit the required documents to see if you’re eligible for the loan.
  • Discuss the interest rates, processing fee, etc., with the lender to process the loan.

Benefits of the used car loan:

At various branches of Mumbai offering best interest rates for used car loans such as -SBI Bank Used car loan, HDFC Used car loan, ICICI Used car loan, Canara Used car loan, Kotak Mahindra Used car loan, Best Bank Used car loan, Federal bank Used car loan, IndusInd Used car loan, Bajaj Finance Used car loan, bank of India Used car loan, Yes bank Used car loan, CITI Bank Used car loan, Sunderam Finance Used car loan , Paisa bazaar Used car loan , ICICI Finserv Used car loan , SBI Yono Used car loan , KVB Used car loan , Allahabad bank Used car loan , Saraswat bank Used car loan, IDFC Bank Used car loan any many others avail a hassle-free application process with speedy approvals and complete transfer support.

The rate of interest for these used car loans is slightly higher compared to new car loans. However, note that the loans against pre-owned cars are available for cars that aren’t used for 5 years.
Loans against a car, because the name suggests, are often opted for by keeping a used car as collateral with the bank.

Advantages of choosing Used Car Loan at Mumbai

Most significantly, the value of a used car is going to be less than that of a replacement car. Hence, the value of insurance for the borrower also will reduce. With a used car loan, not only the borrowing amount is going to be lower, but the repayment terms also will be flexible. Borrowers usually get a tenure of 4-5 years to form the repayment of the loan.

The tenure of those loans usually ranges between 5 and seven years, benefiting the borrowers who can manage their EMIs comfortably. The rate of interest of the latest car loans ranges from 8 percent onwards.

The best place for people to shop for used car loans is Mumbai

Used car loans are often availed in various banks or financial institutions in Mumbai such as-SBI Bank Used car loan, HDFC Used car loan, ICICI Used car loan, Canara Used car loan, Kotak Mahindra Used car loan, Best Bank Used car loan, Federal bank Used car loan, IndusInd Used car loan, Bajaj Finance Used car loan, bank of India Used car loan, Yes bank Used car loan, CITI Bank Used car loan, Sunderam Finance Used car loan, Paisa Bazaar Used car loan, ICICI Finserv Used car loan, SBI Yono Used car loan, KVB Used car loan, Allahabad bank Used car loan, Saraswat bank Used car loan, IDFC Bank Used car loan, etc.

Tips to make used car loan application Process Easy at Mumbai

• Do radical research online to see a lender that gives a used car loan at low-interest rates and appropriate tenure. Various banks and NBFCs at Mumbais offer used car loans at attractive interest rates.
  • Opt for a web application process. This helps in saving time.
  • You can use the car loan EMI calculator offered at online sites to see the monthly payments. The calculator is straightforward to use and basic details like the tenure, loan amount, processing fee, and rate of interest must be entered.
  • Keep the relevant documents ready. Any delay in submitting the documents will cause an extended time for the loan to be processed.
  • Choose a longtime lender so that the loan process is quick.Important Things to try to When Buying a Used Car at Mumbai

Some of the important things that you simply must do once you buy a used car are mentioned below:

1. Check the car that you are taking the loan for at Mumbai: make sure that the car is checked thoroughly. You have to take the assistance of a mechanic to see the car. If there are any issues with the car You have to negotiate the worth. Drive the car where the traffic is a smaller amount, to see for any vibrations.
2. Check the papers of the used car thoroughly: the insurance papers and therefore the registration certificate must be checked thoroughly. Check if the engine number and chassis number on the car match those mentioned on the copies. it’s also important to see if the car has had any accidents.
3. Vehicle history of the used car: the vehicle history must be checked before buying it. Various details of the car are often found online. Checking the vehicle history helps to ascertain if the car has had any accidents and if there are any service issues.
4. Transfer the Registration Certificate: Once the car has been purchased, make sure the Registration Certificate (RC) is transferred to your name. If the car is registered in another state, a NOC is required. If the car has been purchased on a loan by the previous owner, a NOC is required also.
5. Transfer the Insurance: The car insurance policy must be transferred to your name immediately. The policy is void just in case it’s within the name of the previous owner albeit the RC is in your name.
6. Service the used car:the car must be serviced before you begin using it. just in case of any rusts, it must be fixed. Change the fluids and pack up the car before it’s used for the primary time.

As the lockdown is lifted in a phased manner, the auto industry expects the sale of cars to rise. Many of those buyers are trying to find a used car as they’ll use it for a limited time until the threat of the pandemic looms large.

But financing your used car purchase is often confusing because the interest rates are far higher (by 3-7%) than what lenders offer on new cars and every lender looks at different parameters. “Interest rates for used-car loans are generally higher compared to loans for brand spanking new cars. this is often because the danger is higher with a used car. On the one hand, the financer views the profile as slightly riskier

 

A manufacturer provides a guaranty on a replacement car, which isn’t the case with a used vehicle. there’s no clarity on the state of the car, the accidents that have got to have happened, the condition of parts and engine, and so on. it’s for these reasons that lenders view pre-owned cars as risky.

Maximum age bar for the used cars to get financed

Typically, a bank won’t finance any vehicle used than 10 years, albeit you’ve got good credit. If you do not have great credit, you have to find it difficult to finance through a bank, even for a replacement car. But banks are far away from the last option when it involves auto lending.
Banks are a kind of direct lender. this suggests You have to enter and sit face-to-face with them to ascertain what they will provide you with. If you get financing from an immediate lender, they typically cut you a check to require to the dealership, or offer you a maximum limit and pay the dealer directly.

However, banks wish to reserve their loans for patrons with good credit, making it harder for somebody with but perfect credit to travel in and obtain approval. There’s a choice for direct lending, though: credit unions. The answer to the present may be a resounding maybe. Because all credit and lending situations vary, it depends. tons of data seems to point that a borrower may have better luck financing a 10-plus-year-used car with a depository financial institution.

The key to getting lending for a used vehicle from a depository financial institution is that the car must be at value or below, including taxes and costs. If it’s not, the borrower is liable for paying the difference out of pocket. Also, their credit score typically must be good to try to do so. Unfortunately, if you’re battling credit issues, your likelihood is that slim – not just for financing a used vehicle, except for getting an immediate loan generally.
However, credit unions do typically offer borrowers a neater time in getting approved for loans (even on used cars), especially if they’re a member in good standing. The downside is that the borrower does need to be a member of the depository financial institution.

Fortunately, depository financial institution membership is simpler to qualify for today than within the past. depository financial institution membership want to believe something like your job, or fraternal, religious, or organizational affiliation, and lots of still do. lately, though, some credit unions allow membership-supported less strict guidelines, like where you reside or work.

When you finance indirectly through a dealership, the standards for purchasing a used vehicle typically top out at 10 years. That’s not the sole restriction, however. generally, used car financing restrictions include:
• Vehicles must be newer than 10 years used
• Cars must have but 100,000 miles

How to get a loan to shop for a pre-owned car?

Most banks and non-banking financial companies (NBFC) offer loans to shop for pre-owned/used cars. The terms and conditions and charges vary from one lender to a different. Select lenders may provide you with up to 100 percent financing but most will provide you with up to 80 percent.

You have to fund the acquisition of a used car by availing of a loan. However, there are several belongings you got to check before You have to get such a loan. as an example, you ought to determine whether the lender is willing to supply a pre-owned car loan. “The used car you’re purchasing must be eligible for financing by the lender. as an example, some lenders might not finance used cars used than 3 years. The simple step for purchasing a used car loan is enumerated below-

1: Visit the lender

Visit a lender, either online (via lenders’ website) or offline (by visiting its branch office), to use for the pre-owned car loan. Also, to urge a far better rate of interest, do proper research before applying for a pre-owned loan. Check the deals on a good range of used cars at the lender’s online marketplace for used car loans. for instance, You have to check HDFC Bank’s pre-owned car loan section on its website, similarly, You have to also check for the depository financial institution of Indi.

2: Finalize the used car loan

Discuss with your lender the small print of the loan like the quantity you’re eligible for, the speed of interest, processing fee, the tenure you would like, and your equated monthly installments (EMIs). If you think that that you simply might want to prepay or foreclose the loan partially or full, then you ought to ask the lender about prepayment charges.

3: Submit documents

You will need to submit documents to the lender to enable it to process your application. Here is that the list of documents You have to got to provide the lender:

• Photo ID with age proof (like PAN card, Aadhaar card, passport, driver’s license )
  • Photo ID with age proof (like PAN card, Aadhaar card, passport, driving license)
  • Signed form with 3 passport sized photographs (Varies Bank to Bank)
  • Residence proof: Valid passport, voter id card, driving license, postpaid utility bill (gas bill and electricity bill), updated passbook or checking account statement, notarized and registered rent agreement
  • Bank statement of salaried/self-employed individuals for the previous couple of months.

If the applicant may be a salaried individual
• Last 3 months’ salary slips
• Form 16 or tax returns (ITR) documents
If the applicant may be a self-employed individual
• Balance sheet and profit and loss account, computation of income for the last 2 years.
• ITR documents of last 2 years
• Business proof: Registration Certificate, Service Tax Registration, among others
• IT Assessment /Clearance Certificate

Opting for a used car loan at best interest rates is now made easy at various branches of Mumbai such as -SBI Bank Used car loan, HDFC Used car loan, ICICI Used car loan, Canara Used car loan, Kotak Mahindra Used car loan, Best Bank Used car loan, Federal bank Used car loan, IndusInd Used car loan, Bajaj Finance Used car loan, bank of India Used car loan, Yes bank Used car loan, CITI Bank Used car loan, Sunderam Finance Used car loan, Paisa Bazaar Used car loan, ICICI Finserv Used car loan, SBI Yono Used car loan, KVB Used car loan, Allahabad bank Used car loan, Saraswat bank Used car loan, IDFC Bank Used car loan

Difference between Prepayment and Foreclosure of used car loan?

Prepayment is when a borrower prepays a neighborhood of the car loan beforehand whereas preclosure/foreclosure is when the whole of the car loan is paid before the top of the loan tenure. Prepayment charges and foreclosure charges differ from bank to bank. Therefore, before applying for a car loan from a bank, undergo the terms and conditions set by the bank with regards to prepayment and foreclosure.

There are certainly valid reasons why pre-closing/foreclosing a car loan might not be an honest idea:

Put the funds to raised use: The funds that you simply use to pre-close the car loan are often wont to invest during a good systematic investment plan with an honest return on investments. This move is useful especially once you choose a lower rate of an interest car loan.
Penalty charges: Prepayment and foreclosure charges levied by the bank is a further expense that you simply will need to bear. Banks allow prepayment of loans only after 12 EMIs are paid. The penalty fees may vary for the primary prepayment and second prepayment. Therefore, before you opt to prepay or pre-close your car loan, check the terms and conditions of prepayment and therefore the charges levied by the bank.

Car loan transfer: Some banks offer you the choice to transfer your car loan to a different bank that offers a lower rate of interest. However, a car loan transfer from the prevailing bank to a different will involve additional charges. this feature may be a good selection as long as the new bank offers a lower rate of interest and therefore the charges levied by the bank are lower.
Pre-close car loan at the first stages of loan tenure: If you’ve got decided to pre-close/foreclose your car loan, it’s important to try to to it during the initial period of the loan tenure. This way, you’ll save on interest payments. Foreclosing a car loan at a later stage of the loan tenure isn’t beneficial because the penalty fees could also be above the interest payment for the leftover EMIs. Use the car loan EMI calculator available on the bank website or a third-party comparison portal to calculate the EMI Payment, Prepayment Charges, and Interest Payment. supported the results, decide when it’s beneficial for you to pre-close/foreclose your car loan.

Foreclosing a car loan can reduce your credit score: As previously stated, foreclosing on a car loan before its tenure can have a negative impact on your credit score. this is often because, whenever you create EMI payments on time, your credit score improves. Paying your loan EMIs on time may be a surefire way of boosting your credit score. Thus, foreclosing your car loan before its tenure doesn’t help your credit score.

 

Procedure to shut a car loan:

• At the time of purchase, the name of the bank from which you’ve got obtained the car loan to get the car is going to be mentioned on the Registration Certificate (RC).
• Collect all the canceled post-dated cheques given to the bank by you at the time of obtaining the car loan.
• Get the No Dues or No Objection Certificates (NOC) from the bank, NOC has got to be addressed to the Regional Transport Office (RTO) and therefore the insurance firm. NOCs are valid for 90 days from the date of issue.
• Ensure you have the first RC book, Insurance documents, tax documents, and Emission Certificate.
• At the bank, get Form 35 which can mention that the hypothecation has been canceled between you and therefore the bank. Form 35 states the termination of lien or agreement between you and therefore the bank.
• When getting to the RTO where your vehicle is registered, carry the first Bank NOC, RC book, 2 copies of Form 35 signed by the bank and you, car insurance documents, Pollution in check Certificate (PUC), PAN Card, and address proof alongside you. At the RTO, get the hypothecation registered within the RC book canceled. you’ll receive an acknowledgment receipt which will be used as a short-lived RC book until the updated RC book is issued.
• At the insurance office, submit a photocopy of the updated RC book, NOC, and therefore the insurance documents. The insurer will update the records and issue a letter stating the cancellation of the hypothecation.

Defaulting your car loan will have a bad impact on Credit Score

When a borrower fails to form EMI payments repeatedly, it’s considered as car loan default. The terms and conditions of car loan default vary from bank to bank. it’s advisable to barter with the bank once you suspect that an EMI payment cannot be made on time instead of avoiding the lender. Give valid reasons for not having the ability to form your car loan EMI payments. The bank may comply with extend your car loan tenure or the maturity of the EMI payment. Usually, late payment charges are levied on late EMI payments, so request the bank to waive the late payment fee. The bank will send you a written notice of default for not meeting the loan repayment obligations. If the notice isn’t honored, the bank will repossess your car.

A repossessed car is going to be sold off through auction by the bank to catch up on your outstanding loan balance. The bank will advertise the auction details of the repossessed car so that if you opt to bid for your car, you’ll do so at the auction. one of the repercussions of defaulting on your car loan is that it’ll negatively affect your credit score. because the car loan default is going to be mentioned in your credit report, you’ll not be ready to obtain any sort of loan for the subsequent 7 years. Also, if the car is auctioned off at a lower cost than the particular outstanding loan balance, then you’ll need to pay the difference. However, if the car is auctioned off at a better price, the excess amount could also be reimbursed to you by the bank.