How to Get a Used Car Loan for a Great Rate?

The rate of interest is influenced by numerous factors and as a borrower, it is important to have a lower interest rate. A lower interest rate helps you reduce your expenses. If you are looking for a used car loan or Pre-owned Car loan it is important that you have a low-interest rate. Below are a few ways that you can follow to get a used car loan for a great rate:

•    Good credit score or CIBIL score

A credit score or CIBIL score shows the creditworthiness of the borrower. If you have a good credit score, the chances of you getting a loan are higher. In case of low or poor credit scores, there are high chances of lenders rejecting your loan application. Also, there is a possibility that you might get a loan at a higher interest rate. To get a used car loan or Pre-owned Car Loan, you must have a good credit score or above. This will increase your chances of getting a loan with attractive interest rates and other offers. 

•    Heavy down payment 

Another major factor that impacts the interest rate is your down payment amount. It is important to plan your loan prior to applying. This will help you in reducing the loan amount. The less loan amount further helps you in reducing the interest that will be levied on you. There are chances that you might not be able to make a heavy down payment which will directly impact the interest that you have to pay. To avoid such circumstances, you must always plan your borrowers depending on your different sources of income. 

•    Short repayment tenure 

The repayment tenure is the time taken to repay the amount of the loan. The tenure is pre-decided by the lender prior to loan approval. The repayment tenure is choice a given to the borrower as per his/her financial situation. In the case of short repayment tenure, the EMI will be higher, but the overall interest will be lower. Whereas, when you choose longer repayment tenure, though your EMIs are lower but you will end up paying more interest. Hence, it is advised that you choose a short repayment tenure to get a great rate on a used car loan.  

•    Vehicle model and age

Buying a car is on everyone's checklist, there are chances that you might dream of buying a car that is discontinued. In that case, the rate of interest on that particular old car model will be higher. On the other hand, a new car will have a low-interest rate.  

•    Earnings 

While applying for a Pre-owned Car Loan, you need to submit your income proof along with other important documents such as address proof, bank statement, and other related documents. Prior to loan approval, the lender verifies everything possible to ensure that there is no default at the time of repayment. As a borrower, if you have a stable income with a stable job, there are chances that you might get a loan approval with an attractive rate of interest as the lender is assured that you will be able to repay the loan amount without any hassles. 

•    Research about the lenders

Today, there are plenty of options where lenders offer attractive interest rates along with other offers and schemes. Prior to applying for a loan, you must check with all the lenders about their loan offers. When you compare all the positives and negatives of all the lenders, you will have a clear picture about the best suitable loan offer. According to the income and requirement, you can finalize your lender that offers you the best interest rate. 

•    Relationship with the bank 

We all have a bank account in  different banks. Prior to applying for a loan with a new lender, you must always check with your existing bank. The existing bank has your bank statement which means that they have an idea about your financial well-being. If you have a good relationship with your existing bank, there is a  high possibility of you getting a low-interest rate. Rather than approaching a new lender, you should always approach your existing bank or lender. This will give you the upper hand to negotiate with them and provide you with a better offer. 

To Conclude 

Poonawalla Fincorp is known for better and more interesting offers to all its borrowers whether it’s a Personal Loan, Business Loan, or Pre-owned Car Loan. With minimum documentation, you can apply for any kind of loan online through our official website. In case you are confused and want to calculate interest rate, we offer you that feature on our website. You can insert your desired tenure, down payment amount, and rate of interest. This will help you in planning your loan amount.  If you still have any confusion about the process or want to know about any type of loan, you can always reach out and contact us.

Disclaimer

We take utmost care to provide information based on internal data and reliable sources. However, this article and associated web pages provide generic information for reference purposes only. Readers must make an informed decision by reviewing the products offered and the terms and conditions. Pre-Owned Car Loan disbursal is at the sole discretion of Poonawalla Fincorp.
*Terms and Conditions apply