Why opt for car finance?

Why opt for car finance?

Even a used car can make a severe dent in your bank balance, which is why many people opt to apply for a car loan to pay for their purchase. But quite apart from the fact that car finance enables you to keep your savings where they belong - namely in your pocket - it also has several other advantages over a cash transaction. Too many car buyers overlook the importance of financing a car properly. In truth, getting the right car loan, at a good interest rate, is the best way to cut car-related costs. Here’s how you go about getting your vehicle financed.

Banks are the most obvious source of getting finance. They offer good rate of interest especially with the cut throat competition amongst the various banks out there. The downside being the time taken to process the paperwork which could try your patience. But that can be fixed if you have some king of acquaintance with a particular bank.

There are also finance companies which are associated with dealers and manufacturers. Their service is usually quicker.

There are various finance schemes available with the most common ones being Zero percent finance and Attractive rate of interests. With Zero percent finance the dealer and finance company bear the interest damage but the dealer discount is removed and the tenure is shorter than the regular schemes.

There are also attractive flat interest schemes available. The trick though is not to calculate percentage based on total numbers but to calculate owing on cash flow.

Here’s some of the basic information required for financing a vehicle.

Normal Eligibility Criteria:
 
•    Minimum age of applicant: 18 years (Salaried) and 21 years (Self Employed).
•    Maximum age of applicant at Loan Maturity: 60 years (Salaried) and 70 years
            (Self Employed).                                                     
•    For Salaried Employees: Should have worked for one year in the current company
•    For Self Employed: Should have been at least 2 years in the business.
•    Minimum Loan Amount generally given is Rupees One Lakh.