Car Loans – Making the Right Choice

by Sindhu Sindhuja Which is the best Car loan provider of India?

The world is flooded with choices, sometimes we just go with the easiest one. From a range of cars, to a range of car loans, you have a choice to make. To get the best car loan, you have to make the right choices.

The first choice is between a new car or a pre-owned one. Interest rates are generally lower when you opt for a new car. You also get much longer and flexible tenures. On the other hand, many factors come into play when you choose a pre-owned car, such as how many hands has it changed, how many miles its run, the age and working condition of the car, the car brand and model, etc. Used car are cheaper but the loans generally carry higher interest rates and shorter loan tenures.

Secondly, you need to pick a good car, its model and variant. There are a number of car manufacturing companies churning out heaps of models, and a ton of variants under every model. The high-end cars usually have much lesser models to choose from. But the lower and mid-range priced cars have a lot of options between the fuel type, power steering, power windows, ABS, air bags, music systems, rear defoggers, and central locking to name a few. Your choice will factor into your loan approval and interest rates. This is because if you are unable to pay the loan back, the bank will have no choice but to seize the vehicle and resell it in order to make up the outstanding loan amount. Some cars depreciated in value much faster than others. For cars that retain their value for a longer time, banks will have no hassle in reselling the vehicle to make up a good sum. These variants will fetch you better terms on your car loan.

Lastly, if you need to finance your car through a four-wheeler loan, you need to choose the right bank. To find the best option, use tools like eligibility calculators available online which will help you find out which banks are willing to offer you a loan, and what they have to offer. You can use websites like BankBazaar.com to view and compare different loan offers from top banks. Another handy tool is the EMI calculator which will give you all the details you need on your potential car loan. You can play around with different loan amounts, tenures and interest rates, to see which loan would best suit the car of your choice and your financial capabilities. Remember, the longer the loan tenure, the more interest you will pay, and the total cost of the loan will increase.

So before you venture into buying a car and taking out a car loan, do your research to get the best deals. While purchasing a car, be sure to look out for the road tax, RTO charges, the final cost of the car, cost of accessories, modifications, and after-sales services. While applying for a car loan, you should pay heed to the customer service, the type of interest rate you are getting - whether it is fixed or floating, the tenure, processing fees, and the total cost of the loan.