Purchasing a car is an important step for most people in our country, and taking out a car loan is the easiest option to do so. However, the extensive e-market of lenders, terms, and eligibility can be overwhelming. Here is an easy-to-follow guide that covers how to apply for a car loan in India, so you can drive your dream car away worry-free.
Step 1: Check Your Eligibility
To begin, you’ll want to check if you meet the basic eligibility criteria. While it varies slightly from lender to lender, most will require the following:
- A resident citizen of India.
- Aged between 21 and 65 years.
- KYC or stable income (salaried or self-employed).
- A respectable credit score (700+ preferred).
Lenders such as Mahindra Finance also cater to semi-urban and rural customers and can provide flexible documentation and approval processes.
Step 2: Choose the Gross Loan Amount Required
Decide how much loan you will need after accounting for the down payment. Car loans are generally available for an amount of 80-100% of the car’s on-road price. If you’re considering a higher-end model, then make sure your income can afford the monthly EMIs before you take the final decision.
Step 3: Compare Interest Rates
When it comes to repayment, interest rates are vital, but they may also vary with your credit position, loan term, and the car that you bought. When you’re comparing lenders, consider their interest rates, payments, and also check processing fees, pre-payment penalties, and customer reviews to make a well-informed decision.
Step 4: Assemble Your Document
Generally, you will need:
- An identity and address proof (Aadhaar, PAN, Voter ID)
- Proof of income (salary slips, bank statements, or IT returns)
- Car details (invoice or quotation from the dealership)
- Two passport-size photographs
Step 5: Apply Online or In Person
Most online applications are hassle-free when you apply for car loans with lenders such as Mahindra Finance. All you have to do is visit the website, provide your details, attach your documentation, and you’ll receive a decision in just a few steps. You can also visit a local branch to have an in-person consultation.
Step 6: Loan Approval and Funds Disbursal
As soon as your loan application is approved, the entire loan amount will be released directly to the car dealer. At that point, you’ll be informed of your payback, and your EMIs will start as per the tenure you had agreed to for the loan.
Conclusion
Getting a car loan in India has never been easier, as with the help of digital tools and a simplified process, you can quickly check your eligibility, compare different loan offers, and find a trusted lender, like Mahindra Finance, to apply for a loan that suits your budget and other requirements. With a solid plan in place, you could be just a few clicks away from your dream car.
