Owning a car has increasingly become a necessity of life. If dream of owning a car takes a back seat due to your other expenses and plans in life then you can fulfill your dream by apply for a car loan.
These loans are approved based on the strength of applicant’s income. Document requirements and other details like photo, ID card and address proof are same for all banks.
If you want to go for a car loan and wants to choose a bank based on certain factors then we suggest you to look for options where you will be charged with less interest and processing fee. Loan processing does not take much time if you provide them the correct details.
We have listed 5 best banks for you to avail car loan. We have prepared this list based on faster processing, interest rates and transparency.
Bank of Baroda – car loan
Bank of Baroda offers the best interest rate in this segment at an interest rate of 10.5% irrespective of your loan tenure.
Having its presence all over India, you can avail car loan from BOB even if you are in small cities. If you are an existing home loan holder of BOB or can provide collateral security for taking car loan then this bank can offer you concession in interest rates.
Union bank of India – Union miles
UBI also provides car loan in the name of Union miles. Compare to BOB this bank charge you o.2% more on interest rate. With its fixed interest rate of 10.7% this bank is also a good source to avail car loan.
SBI – Car Loan
SBI offers car loan with an interest rate of 10.75%. You can get special benefits from this bank if you are planning to buy TATA cars or from certain specific model.
Punjab National Bank – Car Finance
PNB offers interest rate of 11% on car loan. For new cars, you have to make initial payment of 15% from your own pocket and balance amount will be funded by PNB.
Axis Bank – Car Loan
Axis offers car loan at the rate of 11.5% interest. If you are planning for prepayment then be ready to pay penalty for it. This bank will charge you 5% to 10% of the payment as prepayment charges. Axis offers 95% of the ex-showroom price on selected models.
Bank processing fees and other charges are always less in nationalized bank compare to private banks. Even there use to be hidden cost in private banks which you will come to know after availing the car loan.
Another most important thing you need to ensure is about prepayment penalty and loan tenure. Banks like UBI does not charge anything for prepayment where as private banks charge you for it.
Most of these nationalized banks have loan tenure of 7 years compare to private banks of 5 years. Recently IDBI has launched car loan at the rate of 10.25% as a festival offer. You can contact them to know more on this.