Cars are a symbol of status and prestige. More than ever before, cars have become a household requirement. The demand for used cars has shot through the roof in recent times. Owning a pre-owned luxury car is the new trend among youngsters. Once a means of transport, cars are now of symbol of style and prestige. The general public no longer views big brands away from their reach. Being associated with big brands is highly revered. The ease of availing used car loans has been a big boost for the used car sales. India is growing at a fast rate to achieve freedom of mobility expedited by easy used-car loans.
Features Of Second-hand Car Finance
India is projected to become the third-largest market for used cars. The following reasons will make you consider used car loans:
- You no longer have to sacrifice quality to buy a car. It is easier than ever before to own your dream car. Car loans for used cars are available to back you. You no longer need to look for cheap, low-quality automobiles.
- Flexible repayment options are available. You can easily choose a loan amount and loan tenure that suits you.
- Second-hand car finance is easily sanctioned.
- The application process for used car loans is easy.
- You can pay used car loan EMIs online or offline.
The Eligibility Criteria
The eligibility for loan approval depends on the following:
i. Age of the applicant
The age of the applicant availing used-car loan should be between 21 and 65 years.
ii. Income
The minimum income required to avail of a used-car loan varies across loan categories. A general thumb-rule is to have a minimum salary of 10,000 INR per month for salaried people.
iii. Documents Required
The documents required are as follows:
Ration Card, Passport, Voter ID, Driving License, Electricity Bill, and Registered Rental Agreement are valid address proofs.
Driving License, Passport, Voter Id Card, Ration Card, Photo Credit Card, PAN Card, and Government Employee ID Card are considered valid identity proofs.
Income requirements change across loan categories. It also depends on whether you are salaried or self-employed.
How to apply for Used Car Loan Online
The following steps will direct you in the application of a used-car loan online:
- Visit the official site of the loan lending institution.
- Enter the details requested in the loan application form. Lenders usually ask for contact details and the details of the car you wish to purchase.
- Once you have filled the online loan application form and submitted it, you will receive a call from a customer care executive with further instructions.
- Submit the documents requested
- The lender will then verify your documents and approve the loan. You can now use the funds disbursed to buy the car.
How to apply for Used Car Loan Offline
The following steps will direct you in the application of a used-car loan offline:
- Visit the branch office of the loan lending institution and get the loan application form.
- Fill in the application form with details of the loan you wish to receive.
- Discuss loan details with an executive.
- Submit the necessary documents requested by the financer once you have decided on the loan details.
- You will receive the fund amount once it is approved.
How to choose the best loan provider
Application and approval with a well established second-hand car finance provider expedite the process. The right used-car loan provider can bring mental peace and save money. Consider the following factors while choosing a used car loan:
i. Easy repayment options
Use loan EMI calculator to check for repayment options available at the financer’s website or ask the executive. Check for loan amount and tenure for flexible repayment options and choose accordingly.
ii. Simple Documentation
Choose documentation where a bare minimum of documents can get you verified, thus avoiding unnecessary confusion and a longer time for approval of your loan.
iii. Competitive interest rates
Perhaps, the most influential deciding factor in choosing a loan provider is their ability to offer better interest rates with low down-payment options and flexible EMI schemes.
iv. Loan coverage value
Having a higher loan-to-value ratio helps by allowing your initial investment to be minimal.
v. Extensive branch network
An extensive branch network means a better presence. You can easily walk to a branch nearby to complete your documentation.
The Final Checklist
You must do the following things when buying a used car:
- Inspect the car. If there are any issues, you can either negotiate the price or ask the lender to repair it for you.
- Check the registration certificate and insurance copy. Make sure that the numbers tally with the car. Find car history using its registration and insurance details. Make sure the engine and chassis number match the details provided in the papers. Using registration and insurance details, you can check if the car had any accidents or undergone repairs.
- Once you have purchased it, the next job is to transfer the registration certificate to your name. Both you and the previous owner need to sign the RC. You will require a NOC if the car registration is from a different state.
- Transfer the insurance policy as soon as you have transferred the RC.
- Service the car before use.
Conclusion
More than ever before, there is a demand for pre-owned car loans. Before applying for a car loan, you need to check your eligibility for the same. Now, you need to choose the right loan term and fill up the documents asked for in the application form. Submit all relevant documents backing your identity, proof of address, and proof of income. Once approved, check the car for any defects. Tally documents and retrieve the car history and apply for RC transfer once you have bought the car. Transfer insurance in your name. Service the car. It is ready for use.
Author: Cheryl Julie
