In recent years, the market for used or pre-owned vehicles has grown exponentially in India. As per reports, the used car market is now bigger than the new car market in terms of number of vehicles sold. Just as it is possible to get a loan to buy a new vehicle, you can avail of a loan for a second-hand car as well.
Both commercial banks and well-known financial services providers such as Tata Capital offer instant used car finance at competitive rates. You can also get an amount higher than the actual cost of the used car. This would include additional costs for accessories, security, insurance and others. As credit providers offer compelling options for the second-hand car loan, investing in a used vehicle seems like a good idea. Here are some points that you need to keep in mind while going in for a used car:
- Before you start looking, it’s a good idea to have a budget in mind. A good thumb rule before buying a used car is to determine how much you are willing to spend.
- Narrow your choices after researching on the available options from the list of car dealers. This would involve in-depth research about wholesale prices for used cars or dealer’s asking price.
- Appropriate negotiations should be executed and incentives such as cash-back deals (if available) should be deducted from the negotiated price.
- Apply for a second hand car loan that has flexible payment terms and fast approval.
- Make a checklist of documents required for used car loan application such as proof of assets, proof of income, employment verification, social security number, driver’s license and others. Avail the hassle-free digital process benefits of quick documentation process.
- Understand the applicable interest rates for used car loans provided by the financial institution. Getting pre-approved directly by a lender (on the basis of eligibility criteria) can help you negotiate the best interest rates and save money for the long run.
- Get details pertaining to tenure period of the second hand car loan. Try to limit the tenure period to about 3 to 4 years as loans with longer amount of time typically have higher interest rates.
- Use efficient tools such as the EMI Calculator to have an estimate of how much EMI needs to be paid every month for the used car loan.
- You may also avail the second hand car loan without making a down payment.
- Get information about car insurance and free servicing available for repair and maintenance (if any) with the used car loan.
- You could skip extra options made available by potential used car loan lenders such as adding up expenses for accessories, paint protection, car alarms, rust-proofing, extended warranties and others. To gain in-depth understanding, always follow the paperwork to have details on each item included in the total price of the car. If at all there are any unwanted extras, you could eliminate them out and refuse to pay for it.
- It is important for the applicant to have a good credit score so that the lender trusts in your capability to repay the loan on time. In other words, you are rewarded to showcase a responsible character in paying your bills on time.
- Review the various involved factors as discussed here. This would make the second hand car loan option seem affordable and hassle free. Renowned NBFCs such as Tat Capital are known for their fast and easy loan approval process, competitive interest rates as well as customized solutions to suit personal requirements of applicants. Moreover, the online documentation and application process is easy to follow.
Buying a used car requires higher level of research to ensure that you are getting a well-maintained vehicle. You need to understand the condition of the used car as per its age and mileage (it’s good to get a trusted mechanic to have a look as well).
You may also want to explore pre-owned warranty programs as well.
Thus, detailed research and smart negotiating strategies would help you take the right decision at the right time. To know more on Used Car Loans online, visit our website.