By Admin 
Car Loan Interest Rate: If you are thinking of taking a loan to buy a new car, then do not take the decision in haste. You can make significant savings by comparing interest rates of different banks. At present, some banks are also offering car loans at an initial interest rate of 7.35% per annum.
The thing to understand is that the interest rate you get will depend on your credit score, job, income, loan amount and loan tenure. Therefore the interest rate may be different for every customer.
According to information received from Policy Bazaar…
- UCO Bank is offering car loan at the lowest initial interest rate of 7.35%.
- After this Canara Bank and Bank of Maharashtra from 7.45%
- Whereas Union Bank of India, Punjab & Sind Bank and Indian Bank are giving car loans at 7.50%.
If you take a loan of Rs 5 lakh for 5 years, then your EMI at the lowest interest rate will be around Rs 9,983. At the same time, if the interest rate is high, the EMI can reach Rs 11,634. This means you may have to pay Rs 1,651 more every month. In full 5 years this amount reaches to around Rs 99 thousand. This means that just by choosing the right bank, you can reduce the total cost of the loan significantly.
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If we talk about private banks…
- HDFC Bank- 8.15%
- ICICI Bank- 8.40%
- Federal Bank- 7.65%
- Karnataka Bank- 8.14%
- And IDFC FIRST Bank is offering car loans at an initial interest rate of 8.99%.
But every customer gets the interest rate according to his profile. If your credit score is good and your income is fixed then your chances of getting a lower interest rate increase.
Please also check the processing fees
While taking a car loan, make sure to check not only the interest rate but also the processing fee. Some banks charge low fees, while some banks charge according to the loan amount. Many banks are currently offering discounts on processing fees and interest rates. Also find out whether the bank is charging any prepayment charge for premature loan repayment.
Before taking a car loan, compare the interest rate, loan EMI, processing fee, prepayment charge and other loan details thoroughly. A little wisdom and choosing the right bank can save you thousands of rupees throughout your loan tenure and make your dream of a new car easier.
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