Automobile Finance

Every other day a new model of car is being launched in the country, how many times you must have wished to change that old car of yours and buy a hot set of wheels. However as you come back to earth, bitter reality bites you; realization dawns in that you don't have such a big amount of money to invest in a new car. Don't worry as several banks and financial institution have donned the role of new age Santa Claus to make sure that your dream comes true. Today car loans are not only available for brand new cars but they are also available for used cars. In this section we will try to provide you with an insight into automobile financing so read on.

State Bank of India which is one of the largest nationalized banks in the country offers you the following advantages

• Longer repayment periods up to 7 years
• Low processing
• No advance EMI along with the down payment effectively increasing the amount of loan
• Interest is calculated on the reducing balance method meaning every time you repay an amount the interest is calculated on the remaining amount and not on the one which is out standing at the beginning of the year.

The company gives a loan which is up to 2.5 times of one's net annual income, with the minimum income cap of the applicant being 75000 rupees per annum. The company sanctions loans for all new cars and for second hand cars which are not more than 5 years old. The bank also provides loans to people who don't have an account with the bank provided they furnish address proof, identity proof and other relevant documents.
For more details click http://www.sbi.co.in

UTI bank offers loans covering 85% of the cost of the vehicle plus registration and insurance or 20 times the net monthly salary and you can repay the loan with in a maximum period of 5 years or 60 monthly equated installments.

Some of the key features of the car loan provided by UTI are as follows

• Interest rate of 13% on a monthly reducing basis
• Repayment period up to 5 years
• Installment will be taken directly from the employer under the check off facility.
• The vehicle will be insured for the full amount in favour of the bank

The bank also has an online loan approval system for further details check www.utibank.com

ICICI bank which is one of the largest private sector banks in the country offers some very competitive rates in the field of car finance

Highlights

• Loans up to 95% on new cars and 85% on second hand cars
• Loan repayment period of up to 7 years.
• The bank also provides an option of car over draft by which you can get up to 90% value of the car

Further details can be sought from www.icicibank.com

Several automobile companies like Bajaj Auto have their own finance schemes to facilitate buying of their products and on select models they have 0 % interest installment schemes.

Some of the other financial institution providing car loans are as follows

• Citicorp Maruti
  
• The Financial Services Company of Fiat
  
• HDFC BANK Ltd.
  
• Ford Credit Kotak Mahindra Ltd
  
• Kotak Mahindra Primus Ltd.
  
• The Saraswat co-op BANK LTD.
  
• Standard Chartered Bank - India
  
• Times Bank
  
• Tata Finance Ltd.
  
• Sundaram Finance
  
• Citibank
  
• Associates Finance

Though the criteria for loans differ from bank to bank or from institution to institutions, here are some important points about automobile loans in the country.

Who is eligible for a car/two wheeler loan?

• Any one within 21 to 65 years of age in case of SBI and within in 24-55 years in case of UTI
• Any individual who works for a reputed company be it private or public. A self employed person or a working professional can also avail the loan facility provided he or she is an income tax assessee. A minimum cap on the annual income is fixed from time to time which is subject to be changed without prior notice by the bank.

Documents which need to be furnished

• Proof of Identity
  
• Bank statement for last 6 months
  
• Salary slip with all deductions
  
• Form 16 with recent salary certificate
  
• IT returns along with computation of income certified by a CA
  
• Proof of residence which might include latest electricity bill, telephone bill, credit card statement, passport
  
• Bank statement of the last six months.

These criteria is subject to change and one should refer to the bank documents for the latest updates

automobileIndia.com provides information about different Car finance companies in India.