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Do’s and Don’ts in Car Loan Application
Posted on Friday, May 7th, 2021 | By IndusInd Bank
Buying a car is not an easy choice. If you have already considered buying a new car, there’s no going back. The rule is straightforward here, you need to do your research and go for a car loan application that’s not only easy, but also flexible for you. Loans can be immensely useful in meeting the financial shortages that hinder your financial goals from being achieved. Loan approval, however, depends primarily on your credit risk assessment by the borrower, based on your credit score, salary, work profile, etc. It is also important to choose the right lender, as the interest rates and fees paid by them will vary widely. IndusInd Bank brings you the perfect Do’s and Don’ts in your car loan application with the best interest rate for car loan.
Do’s and Don’ts:
- Do know your limit – You can apply for a car loan that suits your budget and also pay for all your mobility expenses, such as car maintenance, gas, car wash, and insurance as well.
Note – Don’t borrow unnecessarily to fund non-essential expenses or don’t underestimate post-purchase expenses. - Do select the right car – Owning a car is not just luxury, but also a necessity. Ask yourself the main goal of purchasing a vehicle, be it for regular commutes, weekend trips, or special occasions as it will help you decide which vehicle you need to purchase, or at least the category you should consider. For example, an SUV may be perfect for family vacations, but parking in the city can be a hassle.
- Do consider your credit score – Before you apply for a loan, take a look at your credit history and CIBIL’scredit score as they are the key indicator of your financial health. It will allow you to check your standing and eligibility with corrective measures to improve your credit score. Try to pay off credit cards and current loans with unpaid dues. To know if you are eligible for a loan for your chosen vehicle, use IndusInd Bank’s calculator, which offer you the best interest rate for car loan.
- Don’t apply without calculating your required credit amount – Take into account the impending expenditures and compute the necessary loan amount before applying for a vehicle loan.
- Don’t get excited – Avoid loan applications with multiple lenders within a short span of time. It is a must to ensure that you do not apply for loan applications to multiple banks as it will negatively impact your credit score, thus making the loan process more difficult for you. Lenders fetch your credit report from the credit bureaus each time you send a credit application to test your creditworthiness. These lender-initiated credit report requests are known as hard inquiries, each of which will cause the credit bureaus to reduce the credit score by a few points.
Alternatively, visit online financialmarkets to make loan inquiries across a broad range of lenders.
- Choose the right financer – Choose the rightfinancer based on the best bid and quality of service. If you’re along-standing customer with a good record, your bank will give you a betterinterest rate.
Are you looking for a vehicle loan at lucrative interest rates? Turn to IndusInd Bank. We offer loan options for both new car and used-car. Our documentation is minimal, and loan processing is quick and hassle-free. So, get in touch today!
Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.
