Car loans are the lump sum amount that you can borrow from banks or other lending institutions to purchase a new or used car. In today’s world, owning a car is a necessity, not a luxury. Owning a car enables to live life to the fullest, such as you can easily travel to work, go on an outing for leisure, or it helps maintain a good social and professional life. Now there are various institutions and banks which offer vehicle loans. With the provisions and easiness of availing car loans, owning a car is no longer a dream.
In India, loans can be taken for new cars and used cars. These loans enable the individual to purchase a car and repay the borrowed loan amount through easy monthly EMIs. Interest rates on car loans vary from one bank to the other and are influenced by the borrower's monthly income, profession, existing EMI, credit score, etc. On Fintra, our free Car Affordability Calculator will assist in analyzing at what interest rate you can borrow the loan amount and what will be the EMI. Lenders check a borrower's existing EMIs so that the repayment doesn't become a burden for the borrower.
In fact, there are various benefits of opting for car loans. Paying a large sum of cash for a car upfront could disturb one's budget, but also the massive purchase with the liquid cash can put you on the radar of Income Tax department. Thus, while having a car loan, you can manage to retain savings for other current and future expenses. Moreover, one of the greatest benefits of the car loan is that it is secured against the car itself, one doesn't have to mortgage its property or other assets to get this loan. Also, while you are servicing the car loan term, you can use the car- in a few years down the line you have added to original savings and have the opportunity to own the car by paying off the car loan completely. By having a good credit history, doing timely payments, and clearing debts will enable to obtain further loans at ease in the future.