Used Car Loan Rates & Charges

Rates & Charges

Overview Documents Required Application Process Rates & Charges

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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.

Type of Fee	Application Charges
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%.

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Miscellaneous Charges

Type of Fee	Applicable 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

Used Car Loan Interest Rate – Additional Benefits

Not only are used car loan rates & charges competitive, but they also offer a variety of additional benefits. These benefits make availing of a pre-owned car loan extremely attractive for a number of reasons.

Attractive interest rates

Much of a loan is focused on its interest rates. This is because a loan with a high-interest rate makes it challenging for the consumers to repay. Fortunately, second-hand car loans have attractive interest rates that you can avail of to buy your dream car.

At Tata Capital, we offer the best interest rates in the market. Our competitive rates, followed by our loan process, can make it convenient for you to shop with us.

Convenient tenures

Loans that typically have rigid tenures make it difficult for consumers to pay back easily. Fortunately, second-hand car loans have convenient tenures that you can take advantage of. Tata Capital offers a convenient loan tenure period starting from 12 months to a maximum of 72 months. Along with this, our flexible repayment options ensure you can pay your EMIs conveniently.

Quick disbursement

What if you find a used car at an attractive price, but the offer only lasts for a couple of days? In such situations, it can be challenging to get loans quickly enough to avail of offers. But, with Tata Capital, you can get your loan quickly disbursed.

Tata Capital offers a faster approval and disbursal process. Once you submit your documents and everything has been verified, we quickly process your loan so the funds are reflected in your account quickly.

Simple documentation

A lengthy application process with tedious paperwork requirements can seriously affect your loan application process, even discouraging you from applying for one. At Tata Capital, we have simple documentation for our used car loans so that you can get your loan approved faster. We ask for various documentation that is as follows:

Photo identity proof - This can be your passport, voter ID, Aadhaar card, etc.
Income proof - Copy of your last three months’ bank statements, copy of income tax returns (ITR), and profit and loss statement for three months
Copies of salary slips for three months
Residence proof documents such as ration cards, electricity bills, bank statements, etc
Vehicle registration certificate copy
Copy of telephone bill or mobile bill
Copy of your signature

Multiple ways of applying

Most processes have become digitised today, and it’s the same for used car financing loans as well. Tata Capital has numerous ways in which you can apply for our used car loans. You can directly apply online or walk to one of our nearest branches and apply too. In either case, you only have to submit your documents to get the application processed.

Additionally, you can contact our customer care via a phone call or get in touch with our virtual assistant, TIA, to apply for an affordable used car loan. We also offer our services through Whatsapp for quick connectivity and approval.

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.

Calculate EMI

Disclaimer:

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.

Popular FAQS

The old car finance interest rate is the interest you have to pay on the principal loan amount. It depends on multiple factors like the cost of funds, customer credentials, geography, asset, tenor, and discounts offered in the market. With Tata Capital, you get transparent and accurate pre-owned car interest rates, which are the lowest in the industry.

You can easily repay your loan through ECS, Direct debit, and post-dated cheques drawn on "Tata Capital Financial Services Limited".

No, your EMI remains the same for the life of the loan. However, we offer flexible solutions that are specifically designed to fit your unique second-hand car loan rates requirement.

At Tata Capital, you can get Used Car Loans with multiple repayment options. Our Flexi EMIs allow you to select the right plan that fits your needs and budget. Here are the options that we offer-

Fixed EMI

Select the Used Car Loan EMI Plan that suits your cash flow. Under Fixed EMI, the second-hand car loan rates of interest and principal component charged remain the same for the entire loan tenure.

The EMI amount remains the same for the loan period.
Ideal if you have a consistent income.

Structured EMI

Our Structured EMI option allows you to select a repayment method that suits you best.
Customize the EMI as per your requirement
Ideal if you expect your income to increase at regular intervals

We take 24-36 hours to process your application, from the completion of documentation to sanctioning the loan.

Used car loan interest rates are the rate at which you'll have to pay interest on the principal loan amount. This means that your monthly EMIs will include the principal as well as the interest components.

Tata Capital offers the lowest second-hand car loan interest rates in the industry, starting at just 15%.

Besides the interest rates, you'll also have to pay other charges like the processing fee. Lenders charge this one-time fee at the time of loan application processing. The processing fee is non-refundable even if the lender rejects your loan application.

At Tata Capital, the Used Car Loan processing fee is charged at 1.75% of the loan amount.

Lenders charge the interest rate on the principal loan amount. This includes the registration fees for some loan offerings. However, insurance of the car is not a part of its purchasing value and will have to be paid separately.

Interest rates are one of the many charges that you need to pay for your used car loan. If you want to repay the entire loan amount in a single payment, you will have to pay the penalty known as the foreclosure charge.

Tata Capital charges foreclosure as follows:

7% of the principal outstanding at the time of foreclosure + GST if your loan is getting foreclosed within 6 months

6% of the principal outstanding at the time of foreclosure + GST if your loan is getting foreclosed within 6 to 12 months

5% of the principal outstanding at the time of foreclosure + GST if your loan is getting foreclosed after 12 months

Salaried individuals do not get any tax exemptions for a used car loan. However, Section 80 C of the Income Tax Act states that self-employed individuals who want to purchase a car for commercial purposes can get some relief from high used car loan interest rates. The interest you have to pay in a year is eligible for a tax deduction. Self-employed individuals can also file for tax benefits on the depreciation value of the car.

No, the used car loan processing fee is not refundable. Lenders use this money to take technical and legal action for the verification of your documents, your car’s age and make, etc. Therefore, even if they reject your loan application, you'll not receive a refund for the processing fee.

Having a guarantor while applying for a pre-owned car loan with Tata Capital is not a mandate. However, if your income fails to meet the eligibility criteria, we suggest a guarantor or a co-applicant.

For instance, you must fulfil the income criteria to get a used auto loan. This is Rs. 20,000 monthly or more for salaried individuals and a minimum of Rs. 2 lakhs per annum for self-employed individuals.

So, if your income falls in this range, you need not provide a guarantor. On the other hand, if you fail to fulfil this income eligibility criteria, a guarantor can help you secure your second-hand car loan. Note that the guarantor can be your spouse, a blood relative or a close family member to help you improve your loan eligibility.

Furthermore, a guarantor with a high CIBIL score (750 or above) and a healthy loan repayment pattern can significantly increase your chance of securing a used car loan with Tata Capital.

No, with Tata Capital, you don't need to provide additional collateral or security to avail of the pre-owned car loan. However, the car for which the loan is taken is the collateral. This car is hypothecated to Tata Capital documentation, making it the only collateral required to avail of used car financing.

Along with being a secured loan, the Tata Capital used car loan also offers the following benefits-

#1. The second-hand car loan rates & charges are competitive, starting at 12.99% onwards.

#2. The loan tenure is flexible between 12-72 months.

#3. We offer a loan covering up to 95% of your car's value.

#4. We also require simple documentation and fast processing and quick disbursement of the loan amount. You can expect the amount disbursed directly within 24 to 36 hours of document submission to your bank account.

#5. We offer a high principal loan amount that can go up to Rs. 50 lakhs.

Various factors determine the used car loan rates & charges at Tata Capital. These factors include-

#1. Debt-to-Income Ratio - This ratio is important while determining your used auto loan rates & charges as it indicates if you can pay the loan EMIs on time. A high debt-to-income ratio can lead to high-interest rates or perhaps even the rejection of your application.

#2. Increase the down payment for lower used car interest rates - Making a higher down payment reduces your second-hand car loan interest rates. This is because a high down payment highlights that you are financially responsible, given you don’t need the loan to finance a larger portion of your purchase. Often this can mean better interest rates.

#3. Income - The second-hand car loan rates & charges can get lower if you have stable employment with a steady income.

#4. Credit score - An excellent credit score (750 or above) can decrease your pre-owned car loan rates & charges at Tata Capital. After all, a higher credit score represents a good history of repayments signalling you are less likely to default on the loan. This can get you better interest rates.

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Used Car Loan Rates & Charges

What is the Interest rate on a Used Car Loan?

What are the Current Used Car Loan Interest Rates?

Avail TATA Capital loans directly from WhatsApp

Miscellaneous Charges