Eight Things to Consider Before Getting a Car Loan in India

Buying car is certainly a great feeling for many who own it for the first time. But it can be a daunting task for a layman in the industry, especially when you opt for a car loan in India. However, there are several things you need to consider before deciding on getting a car loan. Because, proper planning is the key to save money in any kind of investment. Following are the few steps you need to consider before buying a car loan in India.

Check Your Credit History – If want to get a car loan, lender would first be interested in knowing that you can pay the EMI and you are by no means a delinquent in debt. So make sure you review your credit history and carry no debts before getting the loan.

Eligibility – Eligibility check is very important, as not every bank will offer you loan if you are below 18 or so. And further you should also be ready with proper proofs and identities. However, below 18 can apply for car loan in the name of their father and then finance it.

Market Research – Once you are clear on credit history and eligibility do a thorough market research about the car you want to purchase. Because proper research will give you more options that are suitable for your budget.

Rate of Interest – Obviously this is the first thing you need to consider as it is the most crucial factor. Auto loan in India can approximately lie between 8% to 16% of interest, so you need study carefully which bank can offer you the best interest rate.

Taxes and Down Payment – When buying a car loan in India, the bank or the finance firm will ask you to pay a particular percentage of money as down payment (for example 10%). Lot of finance companies that may not ask for down payment can turn out expensive, so making some amount as down payment would save your money taxes as well.

Third Person Guarantee – Any finance company or bank will ask for third person guarantee, so you will have to be ready with a friend or relative who can assume liability in case you default the payment. Some bank may avoid this clause if you carry good credit history.

Processing and other Fee – Some banks in India will not charge you processing fee for the loan, but some finance firm could charge you approximately 0.3% to 1.1%. Also be clear on how much will the bank charge penalty in case of missed payment.

Negotiation is Possible – Most people are not aware that negotiation in the loan is possible. It’s a myth to think that loans carry fixed rate of interest, you can certainly bargain with the bank and get the best ROI for your car loan.

Buying a car is a dream for most people and hence need careful consideration to it. Check out various info available about particular bank that you are approaching for car loan in India. Calculation of EMI, down payment and taxes has to be done personally by you, instead of relying on the lender. So go step-by-step before you close the deal!

Helpful tips to get personal loans

Here are some very simple personal loans tips that would help you make an informed decision about the type of loan to get and who and where you could get it from. The First Question you should be really asking yourself is:

1. Do I really need it?
2. Can I manage without a personal loan?
3. Is it for a frivolous expense- like a holiday- that I could really avoid?
4. Is it possible that I could secure the money by other means- like borrowing from a relative, taking up a part time job, sale of an asset? If you can avoid it, then don't take the monkey on your back!

A Personal Loan would vary according to certain factors

• The amount that is to be borrowed
• The rate of interest
• Whether it is a fixed or a variable rate of interest
• Loan repayment term( in months or years)
• The down payment or deposit
• The associated fees or costs- broker fees, prepayment fees, origination fees.
• The insurance that the lender would require

In other words, you are buying a sum of money for more than it would cost the lender. It would be a mistake to consider only the rate of interest before taking a personal loan. There are also arrangements fees and penalties of prepayment that you would have to consider. Many of the "no-fee" credit lines carry with them a prepayment penalty. This is the way the lender/broker makes his profit. Please work out the total expenses of your small or big personal loan before signing up for the loan agreement.

Personal Loans are of various types, mainly Secured Personal Loans and Unsecured Personal Loans.

Secured Personal Loans

These loans are given by the lender upon the pledge of collateral by the borrower to secure the loan- like property, or a car. Subsequently as the lender stands to recover his money if there is any default in repayment, the rate of interest charged on the loan is less.

Unsecured Personal Loans

Such loans are given to the borrower with no pledge of collateral or security. As the lender faces a very high risk of losing his money should the borrower default on repayment, the interest rate is quite high.

Unsecured Bad Credit Personal Loan

Here again the borrower with a history of bad credit rating is being given a loan without forwarding any collateral on his part. All the lender has is the borrower's signed promise to repay the loan. Therefore such personal loans are also called signature loans. Signature loans would be issued in full entirety upon the receipt of a signed activation letter or a letter of commitment from the prospective borrower. Consequently to protect the lender's money, the rate of interest charged would be high.

Guaranteed Personal Loan

A guaranteed personal loan comes with a requirement from the lender that the borrower must be having a certain level of income and a good credit rating. He should provide the lender with sufficient proof of his ability to make the repayment.
via:iseekloans

Choosing Secured and Unsecured Loans

Repaying loans is no fun at all. Yet, in today's world, most of us has to pay of some kind of a loan. The rise in the popularity of loans and the ease with which they can be acquired has simplified the lives of loan seekers all over. Thus, many of us look to loans for instant help when we are faced with medical bills and school fees, as well as house and car buying. Loans -- both secured and unsecured -- have made it far simpler for us to get hold of many necessities and luxuries that might otherwise have been unavailable to us. However, the ease with which we get loans also increases our chances of being stuck with a debt burden which might land us with bad credit histories.

It is at such times that we look for ways and means of debt consolidation. Multiple loans can be the reason behind your many new grey hairs. Hence, it makes financial sense to consolidate the loans. By doing this, one would be able to eliminate the worries of dealing with several creditors. Debt consolidation loans pay off our multiple loans at one shot, leaving us to deal with just a single loan provider. This method might also help you to save a lot of money. The repayment of loans tends to be a rather large drain on a person's income. If one is paying off multiple loans, it could be causing the outflow of a lot of cash. However, by procuring a cheap enough debt consolidation loan, one can significantly reduce one's cash outflow.

Now the question that arises is whether you would like to obtain a secured loan or an unsecured one. A secured loan would require you to put some tangible property as the collateral. The interest rates are lower on such loans. However, you could end up losing your assets if you happen to default on the payments. If you are not ready to risk your piece of property, go in for an unsecured loan to consolidate debts. This may be slightly costlier than the secured version, but you will not be putting yourself through undue stress.

Unsecured loans are available to all borrowers. Even if you have a bad credit score, as a borrower you could use an unsecured loan to improve it. As I mentioned earlier, an unsecured loan tends to be more expensive than the secured variety. However, if you will only look around, you will manage to locate the ideal loan to meet your budget...