Retail Loans

Vehicle Loan

1. Basic Eligibility

Typically between 21 to 65 years (at the time of loan maturity)

Indian citizen residing in India

Stable income source (salary, business income, etc.)

Good credit history (CIBIL score of 750+ preferred)

2. Types of Vehicle Loans

New car loans are used to purchase brand-new vehicles. They are typically
secured by the car itself, and interest rates are often lower than used car loans.

A pre-owned vehicle loan is used to purchase a used car. It may require a larger down payment or higher interest rate than a new car loan.

A commercial vehicle loan is used to purchase vehicles for
business purposes, such as trucks, vans, or other commercial vehicles. These loans often
have longer repayment terms and higher loan amounts compared to personal vehicle loans.

A two-wheeler loan is used to purchase motorcycles, scooters, or mopeds. These loans typically have shorter repayment terms and lower loan amounts compared to car loans.

An agricultural loan is used to purchase tractors and other agricultural equipment. These loans often have longer repayment terms and lower interest rates to support farmers. Additionally, they may be subsidized by government programs to encourage agricultural development.

3. Key Factors of a Vehicle Loan

The margin rate for vehicle loans is typically 5% to 20% of the vehicle’s
value, varying by lender, vehicle type, and borrower’s credit.

Interest rates on loans vary depending on the lender, your creditworthiness,
and market conditions. They typically range from 7% to 12% per annum and can be fixed or
floating.

The vehicle you’re purchasing usually acts as collateral for the loan. Some lenders
may require additional security, such as property, depending on the borrower’s
creditworthiness and loan amount.

Loans typically have a tenure of 1 to 7 years. Longer terms result in
lower monthly payments but higher overall interest costs, while shorter terms mean higher
monthly payments but lower total interest paid.