Business & FinanceFactors to Consider While Taking a Pre-Owned Car Loan

Factors to Consider While Taking a Pre-Owned Car Loan

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Having a car at home is more of a necessity than a luxury, today. While you plan to buy a car, applying for an instant personal car loan takes time and careful planning. It comes with a series of factors that need to be considered to get the best possible loan option. But the factors become more crucial to consider when you plan to buy a pre-owned car or apply for a pre-owned car loan.

Though the option for the instant personal loan online is always available, going for a more suited option by thorough analysis, is advisable. So, let us explore the factors that should be considered while taking the pre-owned car loan.

About Pre-Owned Car Loan

Pre-owned automobiles have become increasingly popular in recent years. You can use a personal loan for a pre-owned car. It’s a loan given by banks or lenders to customers who want to purchase a previously owned car by someone else. This instant car loan is offered by both the banks and the NBFCs. It is a no-collateral credit facility with a considerable loan amount, reasonable interest rates, flexible payback terms, and quick approval. Additionally, the eligibility criteria for the loan are pretty basic and lenient.

Eligibility for Pre-Owned Car Loan

The basic eligibility criteria for the pre-owned car loan is as follows:

  • Age should be minimum of 18 years.
  • ID proof – Voter ID, Passport, Driving License, Aadhaar card, or PAN card.
  • Address proof – Voter ID, Passport, Driving License, or Aadhaar card.
  • Income proof – salary slips, bank statements, or tax returns.
  • Passport size photograph
  • Additional documents – Registration Certificate, No Objection Certificate, Pollution Under Control Certificate, and insurance.

Factors to Consider While Applying For Pre-Owned Car Loan

The main factors that one should consider while applying for the pre-owned car loan are as follows:

Credit Score

You should keep in mind the first thing while applying for an instant car loan is the credit score. Knowing the credit score will help you analyze the potential of loan approval. Additionally, this will give you an idea of the loan amount that you can get approval on from the lender.

Overall budget

It is essential to analyze the cost associated with the pre-owned car. Checking the overall budget is important. It will include the amount to be paid as the down payment and the EMIs. Setting a budget will give you an idea of the car you can look for practically.

Low formalities

For the instant consumer durable loan, the overall formalities are quite low. The borrower needs to submit the ID proof, Address proof, Income Proof, photograph, and sign a few documents to get the amount.

Car valuation

Some of the important factors to consider while applying for a loan is car valuation, kilometers travelled, user profile (personal or commercial use), vehicle modifications, car title, usage location, and other factors. Make sure you get a reasonable price for the car you want to buy.

Loan amount

Ascertaining the highest LTV is important before applying for an instant car loan. The general range is 70-80% of the car value for used cars. However, there are chances that a higher LTV might be offered for some cars. But make sure to check the same.

Loan Tenure

Time plays a vital role when Apply instant personal loans online. The higher the tenure, the lower the EMI will be. Tenure of 3-5 years minimum is advisable. At the same time, it is wise to buy a car which is not more than 5 years old.

Interest rate and fees

It is one of the most critical players in deciding on a pre-owned car loan. It depends upon the credit history, income, and various factors. Comparing the interest rate and fees is important to ensure that the car loan is profitable with no hidden charges.

Conclusion

Buying a car is a fun experience. Though it requires an extensive level of research, an instant car loan is there to support your dream of owning a car. Also, the ease of application of instant personal loans online has made seeking loans even simpler and friendlier.

The best platform to secure a loan for a pre-owned car is EasySalary. Just visit the platform and apply for the loan online or through the application. With just simple steps, EasySalary offers you a loan and helps you meet your financial needs or buy that dream car in no time.

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Trisha Oberoi
I turned my can'ts into can's and dream into plans and things begin to change.

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