In India, every year automobile brands launch many new cars with high-end features, high-value services and high-technology. However, the more luxurious the car model is, the higher the cost.
If you are planning to buy a new car the foremost step is to compare the different cars and their prices before finalising. It is necessary to choose a car model based on your affordability and usage requirements.
Once you have chosen a car, financing is the second step as everyone can’t get their dream cars with their savings. There are several options available in the market for getting a car loan and to find the best suitable deal you should check the car loan interest rates of different banks.
During financing a car, you need to arrange about 10-15 percent as a down payment and the remaining amount can be financed from the respective bank. It is important to understand that the higher the car loan amount, the higher will be your equivalent monthly instalments (EMIs).
However, while applying for a car loan, it is also essential to maintain a good credit score as lenders will offer low interest rates if their credit score is good.
Here is the list of car loan interest rates of different banks and the EMIs for a loan amount of ₹5 lakh for a 5-year tenure.
|Name of lender||Interest rate (%)|
Loan amount 5 lakh
Tenure- 5 Years
|Punjab National Bank||7.55 - 8.50||10,031 - 10,258|
|Bank of Baroda||7.70 - 11.00||10,067 - 10,871|
|Canara Bank||7.90 - 10.80||10,114 - 10,821|
|State Bank of India||7.45 - 8.35||10,007-10,222|
|IDBI Bank||8.10 - 9.90||10,162 - 10,599|
|Bank of Maharashtra||7.70 - 11.20||10,067 - 10,921|
|Indian Overseas Bank||8.45||10,246|
|ICICI Bank||7.85 onwards||10,102 onwards|
|HDFC Bank||7.95 - 8.30||10,126 - 10,210|
|Karnataka Bank||8.34 - 10.39||10,220 - 10,720|
|Punjab and Sind Bank||7.70 - 8.80||10,067 - 10,331|
|Axis bank||8.20 - 11.40||10,186 - 10,971|
|South Indian Bank||10.05 - 11.50||10,636 - 10,996|
|RBL Bank||12.00 - 14.00||11,122 - 11,634|
|Indian bank||7.80 - 8.00||10,090 - 10,138|
(Source - Paisabazaar, July 19, 2022)
Moreover, 0.25% interest rate concession for existing housing loan borrowers and corporate salary account holders. 0.05% concession on the interest rate to women & armed forces personnel subject to minimum floor ceiling of RLLR. 0.10% interest rate concession to women car owners having contribution in EMI, subject to minimum ROI.
When you wish to apply for a car loan, you need to submit a set of documents to the bank so that they can verify the information to approve your vehicle request. The documents generally include your bank statement, proof of income, proof of age, proof of address, proof of identity, and proforma invoice among others.
Once your loan is getting passed, make sure that there are no hidden charges on your car loan. Generally a fine is imposed by the bank due to non-repayment of the car loan, so in such an instance, be sure to be alert of how much amount you can lose in advance.