Car Finance Companies

There are many car finance companies in India that can help your dream of owning a car come true. You can purchase a new car or pre-owned car, swap your vehicle, or obtain a loan against your existing vehicle.

You have in hand the broadest choice of financial institutions and banks that can offer you car finance.
Car finances are available from banks and other financial institutions with fixed and floating interest rates for a period that varies from 3 to 5 years.
In spite of the fact that fixed rates are operating in the loan market for quite some time, floating or variable rates were launched in the month of September 2007.
You can choose from a variety of cars across many domestic and International makes like Tata, Maruti, Honda, Hyundai, Mahindra and so on.

Features of Car Finance

The prominent features of car finance in India are given below:

  • Usually, government banks offer lower interest rates than the non-banking financial institutions
  • Banks offer loans upto 90% of the value of the new vehicle and 85% of the value of the used vehicle.
  • The repayment periods offered by the banks range from 12 to 60 months.
  • The rate of interest in auto finance is calculated on a monthly basis
  • In case of a salaried individual, banks provide loans up to three times of his annual earnings.
  • A limited number of banks even offer a repayment period of 7 years
  • In case of a self-employed individual, banks provide loans up to six times of his annual earnings.

Car finance providers in India

Given below are the names of the companies that offer car finance in India:

  • The Financial Services Company of Fiat
  • Citicorp Maruti
  • ICICI Bank
  • HDFC BANK Ltd.
  • Axis Bank
  • Ford Credit Kotak Mahindra Ltd.
  • Kotak Mahindra Primus Ltd.
  • Standard Chartered Bank - India
  • The Saraswat co-op BANK LTD.
  • Tata Finance Ltd.
  • Times Bank
  • Citibank
  • Sundaram Finance
  • Mahindra Finance
  • Associates Finance
  • SBI
  • Allahabad Bank

The table given below will give you a fair idea about the various expenses related to a new car loan:

Lender Rate of Interestá(%) Minimum loan amount (Rs) Maximumáloanáamount(%áofávehicle value) Pre-closure feesá(%áof loanáamount) Processing charges (Rs) Term (Years)
Federal Bank 10% - 15% 1,00,000 Rs. 9,90,000 2% 1,655 - 2,758 1 to 5
Family Credit 13.50% 1,00,000 90% 5% 2,500 - 4,900 1 to 5
KotakáMahindra Bank 11% - 12.50% 1,00,000 95% 5% 3586 ľ 5792 1 to 5
HDFC Bank 10.75% - 12.5% 1,00,000 95% 3% - 6% 2445 - 4395 1 to 5
TATA Capital 10.5% - 11.5%1 1,00,000 90% 4% 3,500 - 4,500 1 to 5
Reliance Consumer Finance 0.5% - 13% 1,00,000 90% 3% - 5% 2,500 - 5,280 1 to 5

Service charges are additional.

EMIS (equated monthly installments) for car finance

EMIS or equated monthly installments are the payment that you need to make every month to pay off your car loan. It is fixed at a certain interest rate. If you have applied for a loan amount of Rs. 100000/- at 12% rate of interest, then you have to pay EMIs in the following manner:

Months EMI
12 Rs. 8797/-
24 Rs. 4661/-
36 Rs. 3289/-
48 Rs. 2607/-
60 Rs. 2202/-
72 Rs. 1936/-
84 Rs. 1748/-

Benefits of car finance

  • Flexible repayment programs, varying from 1 to five years
  • Broadest variety of vehicles in India that are covered by different loan programs
  • Convenient reimbursement of finances with simple EMIs
  • Fast processing with approval of the finance within 48 hours
  • Competitive rates of interest in the market for all cars
  • Lucrative car finance plans permit you to select a program that is fit for your requirements
  • Repayment options comprise Cheque, ECS, Cash or even Draft/Pay order
  • Stress-free documentation method which ensures highest flexibility

Now is the time to own your dream car. To assist you in this, there are several various tailored car finance programs for new and old cars against affordable interest rates.

Remember to

  • Fetch your own credit report
  • Bargain prudently to get the best possible loan rates
  • Go for a fixed rate of interest
  • Be conscious about the pre-payment charges and processing fees
  • It is not essential for you to purchase vehicle insurance from the car dealer
Last Updated on 1/3/2012