Can an unemployed person get a Car Loan in India?

A loan is generally paid to individuals who will be able to pay it back afterwards. To check this eligibility criterion banks generally provide loans to self-employed and employed individuals. They should have a minimum income of 3 lakh to 4 lakh rs. The individual should also complete minimum years of service. Although you are unemployed due to some reason, you need a car in an emergency then there are ways by which you can avail of a car loan.

• Fixed deposits -
  If you have enough fixed deposits in the bank, you can show the lender their interest as income proofs. Also, the loan can be taken against a fixed deposit as a secured type of loan. Loans taken against FDs can have a high-interest rate, but if you specify that the money will be used to purchase the car, it becomes a car loan with lower interest rates. Check interest rates for car loans here.
  
  
• Stocks or shares -
  If you have money in the share market or stock market, you can also use that money to show income proof. If you receive a timely interest rate from any investment you have, that also qualifies as income proof.
  
  
• Secured loan -
  If you have any property or solid assets that you can show as collateral, you will get a secured loan against that collateral. This being a secured loan, you will get a lower interest rate and longer tenure. Some lenders don’t need income proofs or salary slips if you are taking a loan against collateral. 
  
  
• Business loan - 
  If you are taking this car loan to use the car as a business, if you drive this car to generate income, you can get a business loan to finance the car. Its interest rates will be higher, but you will surely get the loan approved to generate income.
  
  
• Perfect credit score - 
  If you have a higher credit score, then some lenders don’t ask for income proofs either. But It would help if you had a perfect credit score for this to happen. A minimum credit score of 750 is required for this purpose. To maintain such a good credit score, you need to have timely payments in your credit history. This is also associated with having a long history as credit history length also matters. A person who has such a good credit score can borrow money and pay it back on time for a longer duration.
  
  
• Making a large down payment - 
  You can put more money up front and then take a small loan so that lender knows that you have enough savings to pay the EMIs on loan and hence you are proved worthy of getting a loan.
  
  
• Get a co-applicant -
  If a co-applicant is employed and is applying for the loan with you, the bank will approve your loan based on that employed individual's guarantee. However, you need to be transparent and honest with that individual and keep enough money aside so that you can be able to pay the EMIs on time without risking the co-applicant.
  
  
• Get a second-hand car -
  If you get the loan for a second-hand car that is low priced then the lender will be more certain to give you the loan as its cost will be less and people are more likely to pay back a small amount than a large amount. Remember you are  so the bank will see you as a high-risk customer, so you need to pay the instalments on time if you want to keep your credit history clean.

Also, when taking a car loan, whether you are employed are unemployed, always check if you will be able to pay the EMIs. This is a financial risk and needs to be taken with precision.