How to get a car loan - Eligibility, documents required and process
To own a car is the dream of every middle man. To make this dream come true most of the banks offer the facility of the car loan. Before applying for the car loan, it is mandatory to understand the whole process of availing the car loan with certain eligibility criteria required for the car loan.
Now, with the facility of car loan, the dream of owning a new car is within the reach of every individual. In simple terms, it is the loan provided by the bank to you to buy a new car. The whole procedure of availing car loan is bit easy than the other types of loans and can be sanctioned in shorter span of time.Stepwise process of availing car loan
Once you have decided for having a car loan then next step remains is to have a detailed knowledge of the complete procedure of availing the same. Here, I am giving the detailed stepwise procedure of availing this loan through your lender.
1. Selection of bank for car loan:
The first step in availing the loan is to select the appropriate lender for your loan. For this, you have to do a lot of research work before applying for the same. You have to check for certain parameters for this. Important criteria in selection of the bank include interest rates, repayment options, processing fees and time required for the sanction of the loan.
2. Documents required for car loan:
Next step in availing the loan is to collect all the necessary documents required in the processing of loan. After you have selected your bank, the agent from the bank will visit your home for the collection of important documents. The requirement of document varies from bank to bank. The basic documents which are required by almost every bank include your salary slip, residence proof and proof of identity.
3. Field investigation by the bank representative:
After the submission of the required documents, a representative from the bank makes a visit to your home for the purpose of finalising the formalities for the same. Bank representative also makes a review of your repayment capabilities.
Also, it is necessary that documents submitted by you to the bank should be original. Otherwise, the representative may reject your application of the loan after finding any fake information. Also, make sure that you should be present at home while the representative makes a visit to your home.
4. Approval of car loan:
Once the bank got satisfaction about the whole process of application, it will approve your application of the loan. The bank disburses the amount sanctioned either through check or demand drafts.Eligibility criteria for car loan
All the banks have set certain eligibility criteria which must be fulfilled by the individual before applying to the car loan. Eligibility for this loan varies from one group to another depending upon certain factors. Mainly individuals applying for this loan come under the four groups.Eligibility for salaried persons for car loan
Here is the basic eligibility for car loan for salaried individuals.
1. The applicant applying for the loan should have age between the 25 years and 58 years at the time of maturity of the loan.
2. The gross annual income of the individual should be more than 2.5 lakhs.
3. The total employment stability of the applicant should be more than two years and current employment stability should be of at least one year. Eligibility for self-employed persons for car loan
1. The self-employed person applying for the loan should have age between 28 years to 65 years at the time of maturity of the loan.
2. The gross annual income of the applicant should not be less than 2 lakhs.
3. The business stability of the self-employed person should not be less than 3 years.Eligibility for partnership firms for car loan
The eligibility for the partnership firms is same as that for the self-employed person except there is no condition for the minimum age requirement.Eligibility for private Ltd Company for car loan
1. The limited company should have an existence of at least 3 years at the time of application of loan.
2. The minimum profit after computing the tax of the company should not be less than 2 lakhs.
3. The business stability of the company should be more than the 3 years.