Everyone wants to have a car of their own, but unfortunately, not everyone can afford one of their own. A car loan comes here to the rescue. It can help people who want to buy their car and pay for them in installments.
Here are some of the steps that you can follow to lower the EMI or the interest rates on your car loan: -
- NEGOTIATE ON THE CAR PRICE: The first thing that you must try is to cut the price of the car. You should try different lenders before you finalize one. If you try this, you can get free accessories too, like the engine lamination, the rust painting, or the free leather seat covers. These do not cost much to the dealer, and even the lenders in the car servicing business can also provide you some free accessories. Also, you can avoid getting the car insurance from the lender as you can get it at a much lower price online.
- LOOK OUT FOR THE NBFCs FROM CAR MANUFACTURING COMPANIES: NBFCs are the Non- Banking Financing Companies and they can provide you really good loans and the best deals on the loans can help you to save money. Also, you can wait for them to tell you the offers and then tell them about the loan.
- NEGOTIATE WITH THE LENDER: - You can negotiate with the banks or the Non-Banking Financing Companies to get a car loan. It will help you to get a car loan with lower interest rates. Also, the burden of the outflow of cash will be reduced. You can check and compare different banks and money lenders and then select the one.
- MAKE BIG DOWN PAYMENTS TO CUT THE EMIs: - Down payment means an amount of money you have to pay initially. You have to make this payment when purchasing the car, and the rest of the amount will be covered in the Equated Monthly Installments (EMIs). You can make a large amount of down payment, and then, the burden of the EMIs will be reduced. If it is possible for you, then you can pay half of the amount of the price of the car in the downpayment, as it will lower the amount of EMIs and the tenure of the repayment of the loan.
- EXTEND THE TENURE OF REPAYMENT: - The repayment tenure of the loan is inversely proportional to the rate of interest. So, extending the tenure of the repayment of the loan will lower the rate of interest on the loan. So, you can avoid the high EMIs on your loan by selecting a longer tenure. The amount of the EMI can be checked with the help of a car loan EMI calculator.
- PREPAY YOUR CAR LOAN: This can also be done to lower the rate of interest on the EMIs. If you get a promotion or your salary will be hiked up during the tenure of the loan repayment, you can use that amount of money by prepaying all or even a certain portion of the loan. It will bring down the value of the principal amount and the duration of the tenure of repayment as well. This will, in turn, reduce your interest liability.
- LOOK FOR A LENDER WHICH CHARGES NO PROCESSING FEE: - Comparing, contrasting, and researching is the key if you want to get a loan with lower interest rates and high benefits. You can check different money lenders and inquire about the processing fee. This processing fee does not affect your EMI, but it will reduce the cost of the ownership.
CONCLUSION: A car loan is a secured loan, and unlike unsecured loans, it has a lower interest rate. The interest rate on a PNB car loan starts from 8.75%. However, by following these steps, you can avail of a car loan with the lowest interest rates and maximum benefits. A person can easily apply for a car loan as the documentation is easy and minimal. Also, the whole procedure is simple and easy. After successfully verifying the documents and the vehicle that you want to buy, the loan will be sanctioned to you.
Also read this: COMMON MISTAKES THAT A BORROWER MAKES BEFORE OBTAINING A CAR LOAN
