Choosing a used car is a value-for-money and a smart purchase. You can get used car loans on a wide collection of cars that range from SUVs and hatchbacks to premium sedans. The car loans on used cars are available up to 90% of the car value along with flexible EMI options and disbursal of loans quickly.
You can now get a loan easily with competitive car loan interest rates and easy documentation. Second-hand car loans are offered at attractive interest rates that may vary from bank to bank. Some lenders offer loans up to 100% of the resale value of the car. Many buyers in this market are going online where online platforms for pre-owned cars offer almost all models of cars along with the fastest loan approval mechanism.
Apply for Used Car Loan – Step by Step Guidance
Applying for a used car loan has become easier and faster; just you need to know how you should proceed with it. Let’s have a look at the most suitable way:
Step 1: Check your credit score
The bank or online platform wherever you apply, they fetch your Credit Score with your permission. You need to have a good credit score to get a vehicle loan. A CIBIL score above 750 is only considered to be a good score. So, before you apply for a loan, make sure you have a score between 750-900. And, if you have a lower score then it is advised to increase your credit score first.
Step 2: Check the eligibility criteria
Apart from your credit score, the bank also checks some other eligibility criteria as well like your source of income, annual income, past credit records, the vehicle brand you are intending to buy, etc. Usually, the eligibility of a used car loan include:
- Age must be between 21-65 years
- Must be salaried or a self-professional
- Must have a stable income and stable source of income
If you meet the eligibility criteria, then getting a loan for used cars is a matter of a few hours. Eligibility criteria are more or less the same in banks and NBFCs. However, these financial institutions state different eligibility criteria for salaried individuals and self-employed applicants.
Step 3: Arrange the required documents
For instant use car loans online, you have to submit some documents. Before you apply for a loan, you should check and verify what are the required documents for approval. The documents that you must submit can differ between bank lenders, you shall have to submit address proof, ID proof, income proof, signature proof, and photographs. You can submit these documents online or visit the nearest bank branch of the lender.
Step 4: Find the most suitable lender for you
Public sector banks are offering bank loans starting from 7.25% to 7.7%. NBFCs offering loans at slightly higher interest rates. However, the interest rates are higher for used or second-hand car loans which may go up to 3-7% more than new car loans.
The top lenders offer used car loans up to 100% of the on-road price of the vehicle. Check the loan tenure, the loan amount, used car loan interest rates, and monthly installments of different lenders, and then choose the suitable one.
Step 5: Calculate EMI
After you have chosen the perfect lender for you, you must take the help of the EMI Calculator to calculate how much monthly installment you can pay. You can put the required loan principal, loan interest rate, loan tenure and you can calculate the exact EMI amount that you have to pay every month to the lender.
Step 6: Apply online
Once you are done with all the above-mentioned steps, you are left with two choices, apply for a loan either online or offline. However, to get instant approval on your loan application used car loan online is the best one to go with. Just fill-up the loan application form that asks to provide some essential information. After you fill-up the online car application loan form and submitting your details on the website, the bank representatives shall call you. If applying through an online platform, your application will be scanned immediately.
Step 7: Amount is approved
Application scanning will include eligibility criteria, supporting documents, etc., and if your profile gets approval, the lenders shall approve the used car loan application online and shall disburse the loan amount to the bank account. After you have the required funds in your bank account, you can book your dream vehicle.
Apply Through Online Platforms
Online used car loans can help you save a lot of money and time. It minimizes the documentation needs and the loans are approved very quickly. You can look for a reputed lender and make your dream to own a car change into a reality. They take the responsibility of primary screening and producing your application to the appropriate lenders. They will provide you several options as well. You just need to select the most suitable option and enjoy on your dream car.
I am Arjun Kumar. I am the owner and administrator of Finance Gradeup. I have completed my education in Arts & Technology. Arjun Kumar usually has interests in playing games, reading and writing. He was a brilliant student during his college days. He also works for many private companies, but the main interest of Arjun Kumar is digital marketing. He thinks that reading is a must before providing any quality information to his readers. You can find Arjun Kumar on much social media handles online, or you can learn more about him in about us page.