In a country like India people with a restricted Gross National Income and a restricted potential to earn due to the existential differences between the earning capacity of the different economic strata contribute to the differences that arise in the income earned monthly. Statistics have revealed that the income earned by the majority population of the country is not sufficient enough to meet the luxurious demands like buying expensive items of jewelry and ornaments, electronic equipment, and even automobile vehicles.
A four-wheeler or a car is something that is considered to be extremely fashionable to possess in India and it marks a distinct existence of a relatively well-off social class. However, the perceptions have changed significantly after the banking institutions have decided to offer car loans to the interested borrowers. Attractive car loan options are available with the interested borrowers to encash on and avail the facility. Following are some of the things that must be kept in mind while availing of a car loan-
Interest Rate for Car Loan- The first consideration that is to be addressed before a car loan is availed is whether the interest rates offered by the private commercial banking institution is reasonable and justified with the presence of adequate interest-earning opportunities. Car Loan Interest Rate refers to the interest or the monthly charge that is payable to the banking institutions by the borrower.
The rate of this fixed charge is different according to the guidelines mentioned in the operating regulations of the banking institutions. Car loan interest rate can be calculated with the help of an Interest Calculator where you can input the amount of the loan, the tenure for which the loan is taken, and a complex mathematical calculation reveals the exact percentage of monthly expenditure which you would have on your car loan.
The loan amount and Tenure of Loan- The second consideration that the borrower must have in mind before opting for a car loan is to determine the amount of the loan which would be taken from the banking institution. Car Loan amount varies according to the institutional policies of the banking institutions.
For example- IndiaBulls Car loan offers the borrower the opportunity to avail of a loan amount whose upper cap is 20 lac. Thus a car loan amount of 20lac suffices the present need of the borrower who is applying for the loan. The third consideration for applying for a car loan is to calculate the most efficient tenure of the loan, the period within which the loan can be taken and repaid along with the interest and the principal amount. The tenure decides the interest rate for the car loan. It is advised by certain banking institutions to take a car loan for 4 years as it helps in saving a considerable amount of money as interest payment.
Processing Fee- The final consideration that is required to be kept in mind before availing of a car loan facility is checking the processing fee before availing of the loan. Processing fee refers to the transaction charges and other preliminary expenses that are availed along with the processing of the loan. After the submission of the documents, the loan process is ratified and the loans are approved through the bank account to the interested borrowers and account holders who are taking the opportunity of availing of the car loan facility. Thus the determination of the processing fee is an extremely critical criterion for the creation of a provision for the car loan.
No comments:
Post a Comment