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Tata Capital > Blog > Loan for Vehicle > First-Time Buyers of a Used Car, Looking for a Car Loan

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First-Time Buyers of a Used Car, Looking for a Car Loan

First-Time Buyers of a Used Car, Looking for a Car Loan

When I shifted to Bangalore after a job offer, I never thought of investing in a car. I was an energetic fresher, just out of college, and happy to spend the first few years of my employed life living in a PG and travelling by public transport. However, very soon I realized that Bangalore traffic leaves you with no option but having your personal vehicle. I never liked riding a bike but was fond of cars. After spending hours on buses and cabs, and reaching office wet with sweat and a day- a long headache, I finally made up my mind to buy a second- hand car. Yeah, you got it right. Buying a new car wasn’t possible with a brand new job. In fact, I had to search for financing options even for buying a used car.

I began my search on the internet. I was amazed to know that India is a huge market of buying and selling used cars with major auto companies dealing with pre-owned cars. The reasons may be manifold- many people who are fond of changing cars prefer buying used cars than the new ones as the latter are way too expensive. Also, for a young, single professional like me, old cars do the trick. Buying a used car also saves you from paying taxes which you have to pay otherwise in buying a brand new car like road tax, loading charges, insurance, state MCD charges, and more. And, this may be a valid reason why over 3 million used cars are sold as against 2.2 million new cars, per year in India. Also, there is a sharp depreciation in car prices. For instance, as soon as the car comes out from the showroom, its price decreases by 10 percent.

And then, I made my mind on Hyundai i10, 2015 model which I found online with one of the local dealers. Now, I had to arrange money for buying it. After doing a fair amount of research about banks and other financial institutions that provide used car loans, I finally decided to go with Tata Capital used car loan. I found their scheme very attractive and pocket -friendly. They offer a competitive rate of interest, resulting in comparatively lower EMIs for the same tenure. The maximum loan tenure for used cars is 5 years. Tata Capital provided me a car loan for an amount equal to 90 percent of my car’s evaluation. Also, I was given the facility of customizing my loan repayment schedule. They offer a unique and innovative repayment methods like step up (EMIs increase gradually), step down (EMIs decrease gradually), Bullet payment (prepayment in parts, periodic payments), and ballooning option (lower EMIs with bigger payment in last EMI).

And the best part with Tata Capital was the quick disbursal of my loan amount and hassle free process. The required documents were minimal and easy to arrange. The documents required for applying a used car loan include ID proof, address proof, signature verification proof, photograph, ITR/salary slips, Form 16, and bank statement for last three months.

For all the prospective used car buyers, the banks and financial institutions will look at the age and condition of the car before approving your loan application. Ensure that the car will meet all your requirements and is pocket - friendly with less maintenance. If the car requires a lot of maintenance, the amount sanctioned will be less. Also, you must avoid buying used cars with an age of more than 5 years as lenders can deny giving loan against such asset which requires a lot of maintenance. My experience with Tata Capital was awesome, and I got more than what I asked.