Lenders gave us a loan with interest to excess their business and fulfill our dream. But loan protection plans aren’t essential, but some banks may sell it to every customer by making them feel it is mandatory. Regardless, you’ll decide whether you need the duvet or not. As an example, if you have a very high life insurance cover, it will be sufficient to cover your loan.
Car insurance, which is imperative, needs to be redeemed separately and all vehicle registration related costs also have to be carried by you as they are not covered by your car loan. Let’s talk about some basic things, you have to know.
Frequently Questions about Car Loan and Car Insurance Plan:
Can I get 100% funding to buy a car?
The maximum amount of loan that you can account for to buy a car will alter to a bank to bank. Most of the banks gave us 85% to 90% on-road-price of the car. But some banks like HDFC Bank, ICICI Bank, etc. gave you 100% on-road-price of the car. These banks also provide pre-approved car loans to their customer.
Can I prepay the whole amount? What are the conditions elaborated?
Yes, you can prepay the entire Car Loan and save on basic interest payments in the future. Most banks will grant the pre-payment option after you have chalked off six months one your loan tenure. You will be wanted to pay a small fee as a pre-payment penalty that will be dependent on the leftover the loan amount.
What kind of credit score do you need to buy a car?
A high credit score above 750 is optimal. But you can apply for a car loan if your credit score is above 600. Learn about this, if your score is too low, your application cloud also is dropped.
Do banks offer finance for used cars?
Yes. Many top lenders like SBI, HDFC Bank, ICICI Bank, Axis Bank, etc., offer loans to buy used cars. These banks offer car loans for up to 85% of the car’s value granted that the car is not more than 5 years old. Used car loans can be repaid in a maximum of 7 years.
Will my credit score affect the interest rate?
Yes. Some lenders will offer lower interest rates to claimants with high credit scores.
If I died, what insurance pays off of my car?
Credit Life Insurance is a type Life Insurance policy drafted to pay off a borrower’s outstanding debt if the borrower dies.
How long a Car Insurance valid for?
Car Insurance policies are valid for 13 months – albeit your car registration is valid only for 12 months. The additional month is a grace period to keep your car guaranteed even if your registration has expired.
What documents needed for a loan?
- Identity proof (any of these) – Aadhar Card, Voter ID Card, PAN Card, Driving License, Passport.
- Address Proof (any of these) – Aadhar Card, Ration Card, Driving License, Utility Bills, Passport.
- Proof of income – Form 16, Salary Slip if you are salaried, Latest Income Tax returns, Six months bank statement.
All the essential things are discussed during this article. To understand more please visit your nearest branch and confirm you’re ready to understand all the important information. Stay tuned with BLOGSROCKS.