Get the Tata Capital App to apply for Loans & manage your account. Download Now


Equipment Finance

Avail Digital Equipment Loans
up to Rs. 1 Crore

  • Attractive ROIs
  • Customizable Loan tenure

Equipment Leasing

Avail Leasing solutions
for all asset classes

  • Up to 100% financing
  • No additional collateral required

What is the Interest rate on a Used Car Loan?

The interest rates for a used car loan vary from lender to lender and depend on multiple factors like your eligibility, income, the used car, etc. At Tata Capita, we offer the lowest used car loan interest rates in the industry, starting at just 15%. Our flexible options allow you to determine the best rates that fit your requirements.

Besides offering the best rates, we assure you of zero hidden costs. Whether it's processing fees, foreclosure charges, or delayed EMI Payments, we ensure you receive transparent and detailed information about everything in advance. With Tata Capital, you not only get affordable second-hand car loan interest rates but also customized plans to meet your unique demands.

What are the Current Used Car Loan Interest Rates?

Several factors come into play when determining the used car loan interest rates. These include the cost of funds, customer credentials, geography, asset, tenor, and discounts offered in the market. Your personal details like your credit profile, monthly income, and repayment capacity also influence the interest rates. 

Processing Fee 1.75% of the Second-hand car loan amount.
LTV With Tata Capital, you can avail of a second-hand car loan for up to 95% of the value of the used car. We even finance 100% value of the used car for select models.
Penal Interest / Additional Interest 3% on Overdue Amount per month + GST.

At Tata Capital, we understand that the requirement of each customer is unique. This is why our experts ensure you get a transparent and suitable deal at low-interest rates. We offer the most competitive interest rates in the industry, starting at just 15%.


Avail TATA Capital loans directly from WhatsApp

Miscellaneous Charges

Bounce Charges ₹ 600 for every Cheque/ Payment Instrument/ ECS Dishonour + GST
Foreclosure Charges
  • If your loan is getting foreclosed within 6 months: 7% of the principal outstanding at the time of foreclosure + GST
  • If your loan is getting foreclosed within 6 to 12 months: 6% of the principal outstanding at the time of foreclosure + GST
  • If your loan is getting foreclosed after 12 months: 5% of the principal outstanding at the time of foreclosure + GST
Mandate Rejection Service Charge

₹ 450 + GST

Charges will be applicable on your EMI Due date if the account does not have an Active mandate after the exhaustion of the given post-dated cheques. We will apply this charge every month until there is an Active Mandate linked to the account.

Statement of Accounts
  • Soft Copy – Nil
  • Branch walk-in - ₹ 250 + GST
Loan Cancellation Charge ₹ 6,500
Instrument swap charges ₹ 550 + GST
Duplicate Repayment Schedule ₹ 550 + GST
Duplicate NOC ₹ 550 + GST
Valuation Charges ₹ 750 + GST
NOC for Interstate Transfer ₹ 1000 + GST
Stamp Duty As per State norms
Broken Period Interest At Actuals
NACH / PDC Charges ₹ 500 + GST
Foreclosure Report ₹ 550
Additional Processing Fee/ Documentation charges ₹ 1500
NOC for conversion of private to commercial registration ₹ 5600 + GST
Charges for Repossession of Vehicle ₹ 22,000

How is Your Used Car Loan Interest Rate Calculated?

You can calculate the used car loan interest rate using a simple mathematical formula-

[ P x R x ( 1 + R ) ^ N ] / [ ( 1 + R ) ^ N - 1 ]

where :
P stands for the Principal Amount
R stands for Rate of Interest, and
N stands for the Tenure of the Loan in months. 

You can add the desired values in this formula to calculate used car interest rates manually. But this process can be time-consuming and complicated. For instant and accurate results, you can use a used car finance rate calculator.

Which Factors Influence Used Car Loan Interest Rates?

While calculating interest rates, lenders consider multiple fixed and variable factors.

Some of the key factors that influence the used car loan interest rates are:

  • Debt-to-Income Ratio

    This ratio reveals if you can pay the loan EMIs on time. A high debt-to-income ratio paints a poor picture and can lead to the rejection of your application or high-interest rates.

  • Repayment Tenure

    The longer the loan tenure, the lower will be your interest rates. But this increases your overall interest payouts. For a shorter tenure, you'll have to pay high second-hand car loan interest rates, but the overall amount that you pay for the car will be low. 

  • Increase the down payment for lower used car interest rates

    Making a higher down payment reduces your second-hand car loan interest rates. It also lowers your EMIs as you borrow a lower principal amount. A high down payment also highlights that you are financially responsible and can repay the loan, reducing your pre-owned car loan interest rates.

  • Income

    You can get low pre-owned car loan interest rates if you have stable employment with a steady income. If you're a salaried individual, lenders will also consider your company when determining the interest rates on a used car loan.

  • Credit score

    An excellent credit score can help you avail of low pre-owned car loan interest rates. A poor credit score can lead to the rejection of your application or high-interest rates.

Avail of a used car loan from Tata Capital to enjoy affordable second-hand car loan interest, starting at just 15%.

How to Become Eligible for a Used Car Loan?

You don't need hefty paperwork to be eligible for a used car loan. With Tata Capital, both salaried and self-employed individuals can easily meet used car loan eligibility by maintaining a good CIBIL score of 750 or above. This will also reduce your second-hand car loan interest. But other criteria will vary slightly.

For example, salaried individuals must be between 21 and 60 years of age and have a monthly income of at least Rs. 20,000, and have work stability for a minimum of 1 year.

Self-employed individuals must be between 21 and 65 years of age, have an annual business income of at least Rs. 2 lakhs, and have a stable business for a minimum of 3 years.

How to Use Used Car Loan EMI Calculator for Calculating EMI?

An EMI calculator makes it very easy to calculate your potential EMIs before submitting your loan application. To use an online used car loan EMI calculator, all you need to do is enter the Principal loan amount, the applicable pre-owned car interest rate, and the desired loan tenure. That's it. The calculator will automatically calculate the EMI value instantly. 



The fees/charges stated above are subject to change at Tata Capital’s discretion from time to time.
Customers who have taken a loan before April 15th, 2019, need to refer to the loan agreement and schedule of charges for applicable interest rates.

For the definitions of the above charges, please refer to the Master Terms and Conditions sheet. We will provide soft copies of the documents mentioned in the table above, free of cost. For hard copies, please refer to the above table for the applicable fees and charges.