The automobiles we drive reveal a lot about who we are. In India, purchasing an automobile is a mark of social status. However, due to the high cost associated with a vehicle in India, owning an automobile is still a dream for many individuals. Banks and NBFCs, on the other hand, are increasingly giving car loans with low EMIs and competitive interest rates. These loans as the name states are created exclusively for the purchase of a car. You can finally realize your golden dream of having a car by taking out a car loan. Many banks and NBFCs also provide Used Car Loans, which are becoming increasingly popular.
If you are a family individual, you know the importance of having a car at your home. You can either purchase a car via your savings or you can get a car loan. If for some reason you want to maintain the liquidity in your savings account or have a better transunion CIBIL score, you can choose a car loan.
As you may be aware, vehicle loans have numerous advantages, the most important of which is that you do not have to pay a large quantity of money all at once. Instead, you can pay off the loan in equal monthly payments (EMIs) and save the money for a rainy day. Taking out a car loan might also help you improve your transunion CIBIL score if you pay your EMIs on time. A good credit score might help you access loans with lower interest rates. While you are applying for a car loan, you will come across a number of myths.
Myth 1: Banks are the best-used car loan lenders.
Obtaining a loan from your bank to acquire a used car appears to be a simple and straightforward alternative. However, NBFCs provide a very personalized loan package for used cars. It offers a competitive interest rate on Pre-Owned Car Loans and has a higher acceptance rate than banks. According to data, NBFCs control more than half of the used-car market. You can know your eligibility using check CIBIL score by pan card.
Myth 2: You can get a car with 100% finance.
Even while many lenders promise to give 100% financing on auto loans, this is not always the case. Banks and NBFCs finance 85% to 90% of the total amount necessary. So, if you rely on them to pay your car costs in full, we urge that you be prepared to make a 10% to 15% down payment.
Myth 3: Most of the banks exclusively serve cities
Due to a lack of reach, it is commonly assumed that financing companies/banks only provide used-car loans in urban regions. NBFCs, on the other hand, are actively expanding in rural areas and focusing mainly on tier-2 and tier-3 markets. According to numerous studies, various NBFCs are bridging the gap in rural areas. They provide used-car customers in smaller cities with a streamlined and hassle-free experience. You can apply for a car loan after checking your eligibility via check CIBIL score by pan card.
Myth 4: Banking firms do not provide value-added services
When it comes to used car loans, it is widely assumed that only banks provide value-added services, as opposed to NBFCs. Contrary to popular assumption, many NBFCs not only provide a flawless digital experience but also provide a variety of value-added services such as insurance and service packages. With these value-added service offerings, NBFCs are viewed as the most trustworthy and preferred option among used automobile buyers. One can know their eligibility via check CIBIL score by pan card.
Myth 5: A used-car loan can only be applied for by one person:
This is the most widely held myth. Due to financial constraints, many people were unable to obtain a pre-owned car loan for their ideal car. However, you can apply for a joint used-car loan with your spouse or another family member. You can make them co-applicants provided they also have a higher transunion CIBIL score and share the EMI with them. This will get you better prices and allow you to effortlessly realize your ambition of purchasing your preferred car.
Myth 6: If you don’t have a good credit score, you can’t get a car loan.
A decent transunion CIBIL score is one of the conditions for obtaining a car loan. Most banks and NBFCs require a credit score of around 750 to obtain a car loan. However, based on the rest of their profile, many banks and NBFCs can issue auto loans to those with lower credit scores. So you can get a car loan even if you don’t have a perfect credit history. This policy differs from one bank to the next.
Myth 7: You can only acquire a vehicle loan for a used car.
Many people nowadays prefer to buy a used car or a used car over a brand-new car. Banks and non-banking financial companies (NBFCs) also make loans in this situation. These are referred to as used automobile loans. Hence, it is completely untrue that you can only avail of car loans when you buy a new car.
Myth 8: Banks have strict automobile loan guidelines.
Banks and NBFCs are becoming exceedingly customer-friendly. If you have a good transunion CIBIL score and the necessary paperwork, they may be willing to modify some of their lending criteria. For example, if you have paid the previous loan in full and on time, they may reduce interest rates.
At last,
Like with everything, you should take consultation with your friends if they have any knowledge of car loans, check CIBIL score by pan card and learn about all of the possibilities available on the market. There are numerous myths about taking out a loan to buy a car. That is why we have compiled some facts to refute those myths. Amidst all those myths, you shouldn’t forget that it is important to make sure your transunion CIBIL score is above 700.
