What is commercial vehicle loan?
Commercial vehicle loan is slightly different from car loan. In simple language, commercial vehicle loan is the loan which is provided by the bank to own a vehicle for the commercial purpose. Nowadays, none of the business can run smoothly unless it has good transport facility. So, for the sole purpose of running their business smoothly, most of the business firms are now strengthening their transport facility.
To fund the heavy finance of new vehicles, most of the firms opt for the commercial vehicle loan.
Eligibility for commercial vehicle loan
After having the brief knowledge of commercial vehicle loan, you must be thinking about the procedure of commercial vehicle loan. But, before knowing the procedure you must know the required eligibility for the same.
In India, there are several banks offering commercial vehicle loan and all have the same set of basic eligibilities for sanctioning of Commercial vehicle loan. Here, I am discussing all the eligibility criteria in detail.
1. Any individual/company/partnership firm which is running the business from more than two years are eligible for applying to commercial vehicle loan.
2. Any owner of at least two commercial vehicles is also eligible for applying to the commercial vehicle loan.
3. Captive customers or transporters can also apply for the commercial vehicle loan.
4. Documents required for commercial vehicle loan-
a) Your identity proof. It can be passport, driving license, voter card, adhar card or similar document which confirms your identity.
b) You also have to submit the proof of experience in the relevant area of your business.
c) If you have taken other types of loan then you also have to submit the track record of all your past loans to the bank.
d) Bank will also demand your 3-6 last bank statements.
Procedure of availing commercial vehicle loan
After knowing the basic eligibility for commercial vehicle loan you must be thinking of how to take commercial vehicle loan? Here I am giving the detail of the procedure of availing commercial vehicle loan.
1. Selection of the commercial vehicle- First step in availing the commercial vehicle loan is to select the commercial vehicle which you want to buy for your business.
2. Application for commercial vehicle loan- after selecting the vehicle you have to apply for the commercial vehicle loan to any selected bank. You can select any bank for the commercial vehicle loan on the basis of following criteria-
a) Interest rate- This is the primary criteria on which bank should be selected. Select the bank which offers minimum interest rate on commercial vehicle loan.
b) Other charges- Also check before applying that what are the other charges for the loan? Other charges include processing fee, repayment penalty etc.
c) Special offers on loan- Sometimes banks give special offers on different types of loans to attract customers. You should also ask the bank if any special offer is there on your loan.
3. Evaluation and approval of loan- After submission of your application, bank will evaluate your application for the loan. After getting all the desired information, bank will decide whether to approve or disapprove your application for loan.
4. Sanctioning of loan- After getting satisfaction from the evaluation of your application, bank will sanction your loan and disburse the same to you either through cheque, draft or in your account.
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