A used car gives you all the comfort that you need, without compromising the quality and without burying youunder any heavy financial burden. Since the used car market is flourishing these days, there are many financial institutions that have made purchasing any basic or premium model of a secondhand car absolutely convenient by offering smartly customized used car loans. A used car loan is an incredible financing solution that allows you to pay for the entire price of the car in the form of monthly instalments with low interest rates and favourable terms and conditions.
However, as the markets are flooded with lending institutionsthat promise premium grade services, you must compare top four or five lenders, interest rates offered by them and additional services, before settling down for anyone of them. Most importantly, you must check the condition of the car that you intend to buy as well as verify all the documents in order to secure your own safety and to avoid any regrets. If you are still not convinced about a how used car loans can prove to be beneficial, listed below are some of the reasons that will help you gain a better clarity about the same.
Reasons why you should choose used car loans
- Reduction of financial burden –When you decide to pay for a pre-owned car solely through cash, you are actually left with no savings as the amount is too high. On the contrary, by taking a loan for used cars, you get to raise yourself to the status of a car owner without struggling with any kind of financial stress. Also, by getting your used car financed, you can return the entire amount of the car to the lender in the form of well-calculated monthly instalments.
- High loan amount – One of the major advantages of taking used car loans is that you can easily avail a high loan amount. There are many lenders that offer a loan amount of up to 50-60 lakhs, especially if you have a flawless credit history.This way, you get to purchase a high-end model of a used car without experiencing any financial struggle.
- Minimal documentation work – With the rising demand for used cars, the lenders have now moved the entire process from application to approval and disbursal online to make it easier for everyone to quickly bring home their dream car. In addition, the whole process demands very basic and minimal number of documents to make it absolutely hassle free for you to seek approval for the loan.
- Flexible terms and conditions – A used car loan also offers the desired amount of flexibility as it allows you to decide your loan amount, tenure and as well as the EMI amount. However, while deciding the tenure, you must remember that you can greatly benefit from a shorter tenure, as you end up paying less interest and quickly get rid of the liability. Furthermore, you even get to select the mode of payment as you can choose between post-dated cheques, auto-debt facility and online payment, depending on your own convenience.
- Alluring interest rates –The interest rates for used cars are usually higher, owing to the risk associated for both the buyer and the lender. However, nowadays there are various lenders that provide unmatched interest rates based on your positive credit score, stable income and an excellent credit history. Moreover, such lenders even provide 90-95% of the car’s value as the loan amount, leaving a very little amount for you to pay as the down payment.
Eligibility criteria for used car loans in India
For those who intend to purchase a used car but do not have the huge amount of funds readily available for payment, used car loans can offer immense help in such situations. In order to seek the approval for the loan, all you have to do is meet the basic eligibility criteria and provide the required documents. Although the eligibility requirements may differ from one to lender, listed below are some common points that are considered by almost every lender.
- The applicant needs to be in the age group of 22-65 years while applying for the loan.
- The monthly income of the applicant should be at least Rs.20,000, and the applicant must provide all the income proof documents to verify the same.
- The applicant must submit all the general documents such as identity proof, address proof and the banks statements of last one year.
After your home, your car is undoubtedly a major investment that you make and hence, this decision needs to be taken wisely. Today, the markets are flooded with numerous financial institutions that provide well-customized used car loan. With this loan, you can avail a high loan amount at alluring interest rates and with minimal documentation work. Moreover, the eligibility criteria of such loans are quite simple and basic to make it easier for everyone to purchase any used car, without burning a hole in their pockets.