Let’s Choose the Best Car Loan for You

Are you losing out on the freedom of planning a travel, the melodious song that your wife sings while travelling in a relaxed mode and the ease of stopping by wherever you want to while you’re on the roads? Don’t worry, owning a car is certainly going to solve all of the above problems cited. And a Car loan is going to make you one step closer to your dream car. Financial institutions have made the Car loan procedures way easier than they used to be in earlier times. Now a days the car loan interest rates are also very much reasonable with minimal documentation involved.

You may check the online tools like EMI calculator for car loan to keep an eye on the equated monthly instalments to be paid on the loan amount availed. EMI calculators are of great help in one’s decision making and getting your dreams come true. This EMI calculator lets you know how much the loan is going to cost you and make you one step closer to the life you want to lead.

How to choose the Best Car Loan?

Check the Interest Rates: This one criteria is perhaps the most basic one to check from the bank side while opting for a car loan. The lower the interest rate, the easier and less painful it is going to be to repay the loan back. Few banks are quite open for a fair discussion and do bargain on their car loan interest rates, while there are many banks providing women customers some additional discount on the interest rates.

Check the Processing Fee: Processing fee of the loan is charged just one time at the time of availing the loan. Choose your lending bank cautiously as few banks have heavy processing charges as compared to others. Many banks charge a fixed processing fee. Some banks charge a processing fee, depending on the amount of loan availed.

Check the Prepayment Facility & Charges: There are few banks which charge a fair amount of money when doing a prepayment earlier than the due date for the car loan. But there are many banks which are not charging at all as a prepayment penalty. Try to avail the loan from a bank which is providing car loan on a zero prepayment condition.

When we think of buying a car for ourselves, sometimes finding the right car in itself is a challenge and another challenge comes up as to how to make a payment for the same. Buying a car is one of the biggest investments that you’ll make, this may come second to only to buying a home so the process has to be duly researched before choosing on to the financial institution to borrow the loan from. To make sure that you are getting the best deal possible, you should go out and explore all the options available. Keep a good check on your Credit Score, this is the single most important aspect while determining what amount of loan you will be able to get smoothly from a bank. In case you choose to go with a bank, an auto loan trader or the dealership themselves, the loan rate will be largely dependent on your credit score. Sometimes banks provide car loan for as low as 1 lakh rupee after considering some basic prerequisites like income of the borrower, repayment capacity, eligibility and work status etc. You can avail car loans for a tenure ranging from 12 to 60 months depending upon your paying capability.

Vikas Agarwal
the authorVikas Agarwal
Vikas Agarwal is an IIT-Varanasi graduate in Chemical Engineering. He is the Founder and CEO of - an investment advisory website. He is a Business Development Professional but a Value Investor at heart. He writes articles on Finaacle, which focus on simplifying the art of investing and the causes of human misjudgment when it comes to investing. He also shares his experiences as an investor and lessons from some of the greatest investors of all time.

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