It is a golden opportunity for the people to buy the cars they wish. The competition between the manufacturer?s outrages as the luxury car makers also stepped into small car manufacturing segment. So all the manufacturers showcase their wide range of cars at plausible price.
And moreover Auto Financing is rooting deeply to aid the car buyer. And many banks are also conducting an expo to get car loans with a tagline of cheaper interest rates. Usually a car loan means a consumer credit that is granted for personal use; usually unsecured and based on the borrower's integrity and ability to pay.
Here Auto financier approaches the customer with more innovative offers and provides loan of up to 90 percent of the original car value. Before that they first analyze the car model and total number of EMI required.So this strategy will make the customer to set free from dumping the whole sum in one assignment.
Initially car buyer can pay only few percent of original car value and the rest in later dues. Several schemes are introduced and based on their needs buyers can opt for them. Following are the list of schemes,
Margin money scheme
Security Deposit Scheme
Hire purchase and Lease EMI
Lease Financing Purchase
Margin Money Scheme:
In this scheme the bank or the financer will provide about 90 percent of the car value.
Initially buyer has to pay 10 percent of the money as a margin payment to the bank or financier along with one month EMI.
The duration fixed for total repayment of money varies from one to seven years. This scheme has lowest amount of EMI to be paid.
The interest will be calculated only for the 90 percent of the money and the loan will be paid by post dated cheques
Security Deposit Scheme:
Buyer has to deposit a sum of money as security.
Deposit will be refunded after successful completion of loan.
Almost 90 percent of money will be notified for lower rate since security deposits is for stipulated period.
EMI rate will be high and usually 10 to 30 percent of the car value will be taken as security deposit.
Some banks will give interests on security deposit, but usually this interest will be lower than to the money charged on the loan.
Hire Purchase and Lease EMI:
An agreement is signed between the hirer and the car owner.
Under this scheme the car will be under the name of a car owner, and the hirer will pay the one third money of the car price and will use the car.
On successful loan completion of the loan by monthly installment the car will be transferred to hirer name.
This scheme has no security deposit and the owner will pay a full tax deductible fixed monthly rental.
Lease Financing Purchase:
A lease between the owner of the car and user for the hire car is made.
Owner owns the ownership of the car but the right to use fall on the user for an agreed period of time.
In this period of time the user should pay periodical rental payments to the owner.
These types of schemes are offered to corporate companies by NBC?s or even the corporate companies.
It is the best tax saving option for the employees.
Car Loans: Basic Eligibility and Mandatory requirements
Its easier to own the car of your dreams nowadays. Many Auto financiers, Banks, engage themselves to aid the buyer to own a car at affordable interest rates. But lots of care and efforts has to be taken by both the financier and buyer to overcome any kind of malpractice.
The main emphasis is made on requirement of documents, the rate of interest of banks, Emi options, and types of loans etc. The buyer has to sign the documents after making a detailed study on the document and should verify the rate of interest and amount quoted to be correct.
Whereas the money lender i.e. either financier or banks will scrutinize the eligibility of a person applying for car loan on various parameters to offer them money.
Basic Eligibility Criteria to apply for Car Loan:
The applicant should be minimum 18 years old if he/she is salaried and 21 years of old if he/she is self employed.
The maximum age limit of applicant is 60 years if salaried and 70 years if self employed
The salaried applicant should work in the current organization for atleast one year
The self employed applicant should be in the business for atleast two years.
The minimum loan amount given for auto loan is one lakh rupees.
For a Salaried Employee any of the following proofs are considered-House Lease agreement, Ration card, Driving license, House Tax Chelan, Housing Society bill, Voter card, Passport, Telephone bill, Electricity bill, Water Tax Chelan, Wireless Landline bill, Credit Card Statement, Post Paid Mobile bills (2 bills required one bill of the last completed month and one which is 6 months before the last completed month).
For a Self Employee they have to submit the address proof of the company.
For a Salaried Employee any of the following proofs are considered- Passport, Photo Credit Card, PAN Card, Voter?s Identity card, Driving license, Employee ID issued by Government of India or PSU or Limited companies, Local Panchayat Identity card, Notary certification with Photograph. Form 16 with latest Salary slips.
For a Self Employee any of the following proofs are considered- Passport, PAN Card, Voters Identity card, Driving license, Latest Sales Tax assessment order, Sale Tax registration certificate.
For a Salaried Employee Latest salary slip is enough.
For a Self Employee latest income tax return is enough.
Partnership firm & Private Companies:
The Address proof required is the documents collected towards identity proof to reflect the current address of the concern or firm
The Identity proof required are Partnership deed, Shop & Establishment Act certificate, Latest Sales Tax assessment order, Sale Tax registration certificate for partnership firms and Memorandum and Articles of Association for private limited companies.
The Income Tax proof required is the Audited Balance Sheet, Profit & Loss Account (latest two years) and the latest 2 years IT returns of the firm.