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Car loan

Overview of Car Loan

A Car Loan is a convenient financial solution designed to help individuals purchase a new or used vehicle without immediate full payment. It allows borrowers to own a car while repaying the loan in affordable monthly installments over a flexible tenure.

Car loans are offered by banks and NBFCs at competitive interest rates, with options available for new cars, used cars, and electric vehicles. The vehicle itself generally serves as collateral, enabling lower interest rates compared to unsecured loans.

At Vidhi Consultancy, we provide expert car loan advisory by evaluating eligibility, credit profile, and budget to identify the most suitable lender and loan structure. We assist clients in securing attractive interest rates, flexible repayment terms, and a smooth, hassle-free approval process.

A well-structured car loan ensures convenience, financial comfort, and smarter vehicle ownership.

Benefits of Car Loan

A car loan offers a convenient and structured way to purchase a vehicle while maintaining financial flexibility. Key benefits include:

1. Affordable Vehicle Ownership

A car loan enables you to own a new or used vehicle without making a full upfront payment, allowing you to preserve savings.

2. Competitive Interest Rates

Since the vehicle acts as collateral, car loans are generally offered at lower interest rates compared to unsecured loans.

3. Flexible Repayment Tenure

Borrowers can choose repayment tenures ranging from 12 to 84 months, based on budget and financial comfort.

4. Quick Approval & Disbursement

With minimal documentation and streamlined processing, car loans are approved quickly, ensuring timely vehicle purchase.

5. High Loan-to-Value (LTV) Ratio

Lenders offer financing of up to 85–100% of the vehicle’s on-road price, reducing initial cash outflow.

6. Fixed EMIs

Car loans typically come with fixed monthly installments, enabling effective budgeting and financial planning.

7. Tax Benefits (For Business Use)

If the vehicle is used for business purposes, interest and depreciation may be claimed as tax benefits, as per applicable tax laws.

8. Enhances Credit Profile

Regular and timely EMI payments help improve credit history and overall creditworthiness.

At Vidhi Consultancy, we assist clients in selecting the right car loan solution by securing competitive rates, flexible terms, and a seamless loan experience.

Eligibility Criteria for Car Loan

Car loan eligibility is evaluated based on the applicant’s income stability, credit profile, and repayment capacity. While criteria may vary across banks and NBFCs, the following parameters are generally considered:

1. Age Criteria

  • Minimum age: 21 years
  • Maximum age at loan maturity:
    Salaried: up to 60 years
    Self-employed: up to 65 years

2. Employment Status

  • Salaried Individuals:
    Employed with a private company, MNC, or government organization with stable income.
  • Self-Employed / Business Owners:
    Business owners or professionals with consistent income and minimum 2–3 years of business continuity.

3. Income Requirements

  • Minimum monthly income as per lender norms
  • Stable and regular income source
  • Higher income improves loan eligibility and loan amount

4. Credit Score

  • CIBIL score of 700 or above is preferred
  • Good credit history ensures faster approvals and better interest rates

5. Employment / Business Stability

  • Minimum 6–12 months with current employer (for salaried)
  • Minimum 2–3 years of business stability (for self-employed)

6. Existing Liabilities

  • EMI obligations within acceptable limits
  • Balanced debt-to-income ratio

7. Vehicle Eligibility

  • New or used vehicle as per lender guidelines
  • Vehicle must be purchased from an authorized dealer

At Vidhi Consultancy, we assess eligibility accurately and recommend the most suitable car loan options to ensure affordability, competitive rates, and smooth approvals.

Documents Required for Car Loan

To ensure a smooth and timely car loan approval process, applicants are required to submit the following documents. Requirements may vary depending on the lender and applicant profile.

1. Identity & Address Proof

  • PAN Card (mandatory)
  • Aadhaar Card / Passport / Voter ID / Driving License
  • Recent passport-size photographs

2. Income Proof

For Salaried Individuals:

  • Latest 3–6 months’ salary slips
  • Form 16 or Income Tax Returns (last 1–2 years)
  • Last 6 months’ bank statements

For Self-Employed / Business Owners:

  • Income Tax Returns with computation (last 2–3 years)
  • Audited financial statements (if applicable)
  • Last 6–12 months’ bank statements

3. Employment / Business Proof

  • Employment ID / Appointment letter (for salaried)
  • Business registration proof (for self-employed)

4. Vehicle-Related Documents

  • Quotation / Proforma invoice from authorized dealer
  • Vehicle details (make, model, variant)

5. Loan Application Documents

  • Duly filled loan application form (Basic Details)
  • Processing fee cheque (if applicable)

At Vidhi Consultancy, we assist clients with documentation verification and lender coordination to ensure quick approvals and hassle-free disbursement.

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