As a young professional, buying your first car is probably on your bucket list, isn’t it? If so, you should consider a second-hand car.
While a shiny, brand-new car is undoubtedly a dream come true, a second-hand car makes for a more affordable and wiser option in the early stages of your career. You can also easily avail of a used car loan to meet the expense.
To ensure the process goes smoothly, here are some things you must keep in mind before applying.
Research before choosing a lender
With a variety of options before you, selecting a suitable lender can be tricky. To streamline the process, begin by thoroughly researching lenders that provide loans at competitive interest rates. Also, look out for their used car loan eligibility and if you qualify the same. It would be best to make a list of lenders you find trustworthy and keep comparing every option to shortlist.
Some lenders may decline to finance used cars older than three or four years. So make sure that the model you’re purchasing is eligible for financing.
Estimate your EMI in advance
If you’ve just started earning, you should plan your finances properly, so the EMI deductions don’t take a toll on your account. Chalk out your budget and assess how much you’re comfortable with paying every month. An easy and effective way to achieve this is through a used car loan EMI calculator. All you need to do is enter your basic details like the tenure, loan amount, processing fee, and interest rate.
Additional Read: What to Look for in a Used Car Loan Agreement
Apply for the loan online
Choosing the right second-hand car takes time, no doubt! After all, you have to visit multiple sellers and showrooms to inspect the vehicles in person. That’s why you should carry out the used car loan application process online since it’s faster and only requires minimal paperwork.
Simply visit your chosen lender’s website and go through the application process before you apply.
Get someone to co-sign your application
If you’re younger than 25, consider asking someone to co-sign the loan. With a co-signer, who can be a family member or a friend, you’re essentially adding their name to your loan application. This will help you in more ways than one. Since you’re starting out, you probably wouldn’t have a track record to show your creditworthiness.
In such a scenario, a co-signer with a good credit score can maximize your chances of getting loan approval.
Keep your documents ready
Finally, arrange all the necessary documents for your application. Timely submission of the application form along with the documents will ensure that your loan is processed quickly.
At Tata Capital, we request the following documents:
- A photo ID, such as your Aadhaar Card, driving license, or passport
- A valid residence proof, such as your voter id card, electricity bill, ration card
- The car’s registration certificate
- Salary slips for the last three months
- A verified copy of your signature
Additional Read: What are the Documents Needed to Avail Used Car Loans?
Now, feeling confident about purchasing a pre-owned car? Then let Tata Capital help finance the cost. We offer used car loan interest rates as low as 15% and provide easy applications online. To know more, visit here.