Car Loan Market For New Cars

Car Loan Market For New Cars

Car Loan Market For New Cars

In India, most people hesitate to buy new cars thinking of the financial burden. They fail to think of a car loan as a feasible option. This article speaks of the types of car loans available in the Indian market, thus helping car buyers choose the loan that suits them best. Without actually knowing all about loans, the process can be very cumbersome.

Recently ICICI and HDFC raised the interest rates of auto loans in India. They gave a clear sign that rates would get tougher in future. The two companies, till recently, had special home loan schemes too. Now, these have been discontinued. The Reserve Bank of India had expressed discontentment at teaser rates as it categorizes existing borrowers and new ones separately. Other companies will soon be following the two banks, and, on the whole, car loan rates will be increased by 0.25 to 0.50 per cent. Isn't that a matter of concern? We should know how to intelligently invest in a car by choosing the best type of interest rates on the loans available in the Indian car market.

The Indian car market basically has two types of car loans: fixed and floating. Which one you choose, depends on your capacity to pay back and the risk you're willing to take. During the entire term of loan repayment, your interest rate will remain the same if you opt for the fixed loan. As for the floating interest loan, based on the market condition or the RBI regulations during the particular period, the rate will increase or decrease.

Another phenomenon is the independent credit service that will process your request for credit and forward it to the lender that is most likely to approve the request. These services usually work with a car dealer who have access to both National and Regional lenders.

The Online Credit Application

The independent credit service has successfully introduced the online credit application to the market. The online credit application offers a no hassle approach to applying for credit. Anyone who has sat in front of a loans officer and had to explain their credit history will find the online credit application a blessing. If you decide to complete an online credit application make sure that it is secure. Look for a security certificate. Comodo and Verisign are two companies that offer security certificates that I am familiar with. You should also look for a privacy policy to guarantee that your personal information will not be shared or sold.

Regardless of your past credit history there is almost always a lender who is willing to provide you with a car loan. The question is how much are you willing to pay for that loan? A few extra percentage points are worth the opportunity to rebuild your credit. But be sure that your financial house is in order before you apply so that you can qualify for the best rate and terms your current financial circumstance will allow.

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