5 Myths and Their Facts about Car Loan

What is a car loan?

Alexandra Paul once said that the cars we drive say a lot about us. Buying a car is a symbol of social status in India. But owning a car which will enhance your reputation was that one ‘never coming true dream’ until recent times due to the high price of any vehicle in India. But with easy EMI options and attractive interest rates, banks and NBFCs are now offering car loans. These loans are specifically designed to buy a car or any other vehicle for that matter. By opting to take a car loan, now you can touch the golden dream of owning a car. Many banks and NBFCs also offer Used Car Loans which are getting famous day by day. But there are many misconceptions when it comes to taking a loan to buy a car. That’s why we have come up with some facts against those myths…

MYTH 1: You can’t get a car if you don’t have strong credit score

Having a good credit score is one of the requirements to get a car loan. The required credit score for most banks and NBFCs to get a car loan is around 750. But many banks and NBFCs offer car loan to those with lower credit score depending upon rest of their profile. So you can avail a car loan even if you don’t have such strong credit score. The policy varies from bank to bank.

MYTH 2: You get car loan only for new car

Many people now-a-days prefer buying used car or second hand car over brand new car. Banks and NBFCs provide loans in this case too. These types of loans are known as used car loan. Click here to know more about used car loan.

MYTH 3: Only one person can apply for car loan

To get a car loan, you can apply for the loan with your spouse or a family member. By adding them as co-applicant, you can avail better deals as the credit score changes as you add another applicant for your car loan.

MYTH 4: Banks have rigid rules for car loans

Banks and NBFCs now-a-days are extremely customer friendly. They can bend some of their loan rules if you have a strong credit score and right documents with your application.

MYTH 5: You get 100% financing on your car

Even though many lenders do promise that they provide 100% financing on car loans, in reality that doesn’t happen. Banks and NBFCs finance 85% to 90% of required amount. So if you are relying on them to pay your car bills in full, then we ask you to be prepared for a 10% to 15% down payment.

Now that you are aware of these unknown facts about car loan, why don’t you apply for one? Click here to check your eligibility for car loan.

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